UK residential transactions increased by more than 4% in August as the market continues to show remarkable resilience in the face of some tough economic conditions.
The latest figures released by HMRC show that non-seasonally adjusted UK residential transactions in August 2022 increased to 114,440 – a 4.4% rise compared to July, and 9.7% higher than they were in August last year.
Meanwhile, the seasonally adjusted estimated figures found that transactions rose by 7.6% year-on-year as the property market exceeded the low expectations set by the rising cost of living and economic slowdown.
Property Prices Rise Again – But Rate of Growth Slows
Given the current soaring inflation and rising interest rates that are vastly increasing the cost of borrowing, many expected the property market to slow – but even prices have continued to buck previous predictions.
The latest Halifax Price Index shows house prices increased by 0.4% in August, although the annual rate of growth did drop slightly from 11.8% to 11.5%.
A typical property now costs a record £294,260, with London recording its highest annual house price inflation in six years.
Kim Kinnaird, Director of Halifax Mortgages, commented:
“The typical house price reached another record high in August (£294,260) – as it has done in seven out of the eight months so far this year. However, the annual rate of growth dropped to +11.5%, from +11.8% in July, the lowest level in three months.
“While house prices have so far proved to be resilient in the face of growing economic uncertainty, industry surveys point towards cooling expectations across the majority of UK regions, as buyer demand eases, and other forward-looking indicators also imply a likely slowdown in market activity.”
Despite this, she said that any slowdown in house price growth should be viewed in the context of the “exceptional” growth seen in recent years, with house pricing rising by over £30,000 in the last 12 months alone.
What’s Going to Happen Next?
Many property investors may feel worried about the impact soaring inflation and a slowing economy may have on the property market, but current figures and trends should go some way to alleviating any fears.
Whatever the next year brings, it’s important to remember that property has always historically been a safe place to put your money, providing you invest wisely and take advantage of smart investment opportunities.
Many unfavourable conditions, such as rising mortgage costs pushing up buy-to-let mortgages, can also be avoided by looking at alternative investment options such as our Avora Capital solution, which delivers regular income without any need for a mortgage.
If you’d like to discuss the current market and the different options that may be available to you, please don’t hesitate to give us a call and speak to one of our knowledgeable experts. Get in touch today to request a callback.
Important note: The information provided in this article is general in nature and does not constitute personal financial advice. If you are unsure whether an investment is right for you, please seek professional advice. If you choose to invest, the value of your investment can both rise and fall so you may get back less than you put in.