Property transactions fell 2% last month following a similar drop last time, according to new HMRC data.

Figures for seasonally adjusted residential deals in May were down on April from 100,440 to 98,450.

The numbers were 17% higher than in May 2025, but the market was heavily affected at that time by the ending of a Stamp Duty threshold in April.

Non-seasonally adjusted residential transactions increased by 7% in May compared to April.

Last month, the HMRC transactions figure revealed a 3% fall as the market struggled with global uncertainty factors. There was a monthly drop from March to April of 103,910 to 101,030.

Industry reaction

Tom Bill, Head of UK Residential Research at Knight Frank, says: “The clearest signal from today’s data is the absence of a seasonal bounce in the housing market, with transactions falling 2% between April and May at precisely the time of year when they should be rising.

“The Middle East conflict and associated rise in mortgage rates has kept a lid on activity but domestic political uncertainty will further stifle demand. There will be questions over what taxes the new Chancellor will raise but also the credibility of wider ambitions to reform property tax, many of which are based on plans that are unachievable for a number of years.

“Speculation looks set to be the enemy of the property market this summer.”

Anthony Codling, MD Equity Research at RBC Capital Markets, says: “May’s 98,450 seasonally adjusted housing transactions sit bang on the five- year average and just shy of the ten-year average, a business as usual market and, frankly, that’s not the worst place to be.

“We have yet to see the impact of the Iran war on housing transactions, but had an early look yesterday with May mortgage approvals down 15% month-on-month and down 11% year- on-year. UK housebuilders will be hoping for a Burnham building bounce…”

Nathan Emerson, CEO at Propertymark, says: “An increase in both month-on-month and year-on-year figures for non-seasonally adjusted housing transactions is an encouraging sign that buyers and sellers continue to have the confidence to move despite ongoing economic pressures.

“Our member agents are reporting that well-priced homes continue to attract strong interest, particularly where there is a good choice of stock available.

“However, maintaining this momentum will depend on improving housing supply and creating greater certainty for consumers. Stable economic conditions, affordable borrowing, and policies that support home ownership are all essential if we are to keep the market moving and give people the confidence to make long-term decisions.”

Taking advantage

Tomer Aboody, Director at MT Finance, says: “With higher transaction levels year on year, we are seeing buyers taking advantage of lower mortgage rates along with more flexibility on the behalf of lenders.

“The more muted month-on-month transaction figures may be down to some uncertainty around the Government leadership, along with ongoing macro factors including the Middle East war.

“With a new Prime Minister imminent, the market is facing a slightly uncertain few months with the possibility of further taxes. Hopefully some common sense and a drive in the economy can weather any extreme changes.”

Jeremy Leaf, north London estate agent and a former RICS residential chairman, says: “Transactions are always a better measure of market health than more volatile prices.

“Although these figures reflect decision-making principally from a few months ago, they confirm what we have been seeing in our offices – it is harder to generate commitment and momentum, particularly while uncertainty remains over economic prospects and especially mortgage rates.

“Looking forward, the outlook is not particularly promising now that additional political concerns have been added to the mix. However, those needing to move after negotiating as hard as possible are continuing for the most part, albeit often frustratingly slowly.”

It is a strong buyer’s market, so those ready to make a move are finding they are in a compelling position.”

Jason Tebb, President at OnTheMarket, says: “The slight dip in transaction numbers month-on month suggests the ongoing resilience of the housing market in the face of economic and political uncertainty.

“Buyers and sellers are mostly adapting to changing circumstances and continuing to proceed with their transactions, rather than stepping back and delaying decisions.

“The steady interest rate environment, with the Bank of England holding the base rate at four consecutive meetings, should have a calming effect. Falling mortgage rates are assisting borrowers and helping with affordability.

“It is a strong buyer’s market, so those ready to make a move are finding they are in a compelling position. This will help keep property prices in check, which should also assist first-time buyers ready to take the plunge.”

Richard Donnell, Executive Director at Zoopla, says: “Housing transactions tell us about sales agreed 5-6 months ago – this latest data shows sales completions starting to slow in May compared to April which reflects the impact of last year’s Autumn Budget on sales.

“Looking ahead, while there is a healthy pipeline of sales from recent months, higher mortgage rates over April have hit new sales agreed which are down 7% year on year in June. This will feed into fewer completed housing transactions which we expect to be 6-8% lower than last year compared to the 2% drop we forecast at the end of last year.

“There is demand to move home, but buyers have become more cautious. Sellers need to price carefully to attract demand if they want to sell their home this year.”

Iain McKenzie, CEO at The Guild of Property Professionals, says: “Today’s transaction data reflects a market that remains resilient despite navigating a complex set of headwinds.

“The market’s foundations remain solid. Inflation has held at 2.8% and the Bank of England has kept the base rate at 3.75%, providing a stable platform for lenders who are already competing aggressively for business. Nationwide has cut its rates three times in June alone.

“That downward pressure on mortgage pricing translates directly into improved affordability and borrowing power, and its effect on buyer confidence should gradually feed through to transaction numbers in the months ahead.

“Crucially, the non-discretionary mover continues to underpin the market. Annually, a substantial portion of transactions are driven by unavoidable life events, and those movers are not waiting for the perfect conditions.”

Mark Harris, Chief Executive at SPF Private Clients, says: “The fallout from the war in the Middle East is impacting housing market activity, although these figures show transaction numbers dipped by a relatively small percentage month-on-month.

“With the Bank of England holding base rate for now, mortgage lenders continue to trim their rates in light of improving funding conditions, which is good news for borrowers.

“However, nothing should be taken for granted and borrowers in need of a mortgage may wish to secure a rate sooner rather than later to protect themselves against fluctuating pricing.”

More nuanced

Amy Reynolds, Head of Sales at Antony Roberts, says: “On the ground, the picture is more nuanced than the national headlines suggest.

“The recent weak mortgage approval figures suggest real caution at the more rate-dependent end of the market, but a good proportion of buyers we are seeing are equity-rich or cash, and well-priced family homes in the right roads are still drawing competitive interest.

“There is the familiar pre-summer push from families wanting to be settled before the new school year, but the mood is steady and selective rather than booming or stalling.

“We expect a quieter, price-sensitive summer, with activity firming again in the autumn once buyers have more clarity on rates and the geopolitical noise has died down.”

Nick Leeming, Chairman at Jackson-Stops, says: “Today’s HMRC figures showing an increase in housing transactions are an encouraging sign that activity is continuing to build, despite a market that remains shaped by affordability pressures and cautious buyer sentiment.

“Across the Jackson-Stops network, we saw both new listings and buyer viewings increase throughout May, reflecting growing confidence among those looking to move.

“While buyers remain selective and negotiations are taking longer than they have in recent years, there is clear evidence that underlying demand remains resilient where homes are priced appropriately and sellers are prepared to meet the market.”

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