Following the release of the HMRC property transactions data for July, industry experts have reacted and shared their thoughts with IFA Magazine.
Nicky Stevenson, Managing Director at national estate agent group Fine & Country said: “Property transactions were stable in July, rising slightly compared to June on a seasonally-adjusted basis. Affordability pressures caused by successive base rate rises are squeezing demand compared to last year, but the housing market is proving resilient.
“Buyers have become used to the higher-rate lending environment, and many sellers are pricing their properties accordingly. Sensibly priced properties continue to attract a lot of interest, while smaller homes in affordable locations are proving the most popular.
“A pause in base rate rises would stabilise mortgages and inject even more confidence into the property market. Hopefully we are soon reaching the point where the Bank of England can take a step back from interest rate hikes and let the economy recover of its own accord without needing to pull another lever.”
Adam Oldfield, chief revenue officer at Phoebus Software, says: “The news doesn’t get any better at the moment. With reports yesterday from the Bank of England and Zoopla, showing how slow the market has become, today’s non-seasonally adjusted figures from HMRC make grim reading.
“Our beleaguered housing market is in dire need of a pick-me-up. Unfortunately, we may have to wait a few more months to see an upturn, but there may be light at the end of the tunnel. The knock-on effect of rising mortgage costs is that house prices, artificially inflated during the pandemic, are coming down and making it more affordable for those trying to get onto the property ladder.
“This could mean first-time buyers, who have been desperately trying to save for a deposit, may find asking prices falling within their budgets. Nonetheless, the responsibility for assessing affordability of ownership, not just paying a mortgage, will be with lenders. It is definitely a buyer’s market, but no doubt with an air of caution.”
Vikki Jefferies, Propositions Director at PRIMIS said: “Despite tough market conditions as a result of elevated inflation and the cost-of-living crisis, property transaction figures continue to sit well above the numbers we saw pre-pandemic. This speaks to the resilience of the market, which should see activity bounce back once inflation and interest rates return to lower levels.
“In the meantime, broader market activity is being driven by re-financing. Data from our product desk shows that product transfers and rate switching have continued to be a focal point for broker queries. While this is the case, brokers should ensure that borrowers are exploring all the options available to them, whether that be product transfer or remortgaging, so their customer can make the most informed decision possible when their fixed rate comes to an end.
“Training and workshops provided by mortgage networks’ can prove to be invaluable for brokers in managing customer and lender queries throughout this period.”
Karl Wilkinson, CEO at Access Financial Services said: “As anticipated, the market continues to feel the knock-on effects of mounting interest rates. But with falling inflation, and increased stability in swap rates, we should start to see signs of smoother sailing in the second half of the year.
“Advisers must focus on providing expert knowledge and support to those looking to move or remortgage especially the reported 800,000 fixed-rates loans coming to an end in the second half of this year and further 1.6 million in 2024.
“With mortgage rates now stabilising, and the turbulent end to 2022 firmly in our rear-view mirror, we are observing the green shoots of recovery with the industry reporting a resurgence of both buyer and seller interest in the market.”