- The seasonally adjusted estimate of UK residential transactions in December 2023 is 80,420 18% lower than December 2022 and 1% lower than November 2023
- The seasonally adjusted estimate of UK non-residential transactions in December 2023 10.030, 3% higher than December 2022, 3% higher than November 2023
“The latest HMRC figures indicate that residential property transactions fell for the fourth consecutive month in December 2023, down 1% from November.
“We have seen a persistently challenging market in recent months as the property sector continues to cool under the pressure of high inflation and rising interest rates. Having said this, Christmas is always a slow month with fewer transactions historically, so underwhelming numbers are not necessarily an accurate reflection of market conditions. Looking at the year-on-year data, we can see some signs of the market stabilising after the initial shock of rapidly rising rates.
“In contrast, non-residential transactions, which saw a 3% increase this month, point to the sector weathering challenges better than housing. Investors seem more confident to transact despite economic headwinds and the higher cost of borrowing. With approximately €200 million worth of real estate debt set to mature in 2023/24 in UK, France and Germany alone, the cost of borrowing and debt servicing will be the defining theme of 2024’s commercial real estate market. Continued volatility is likely until inflation and rates normalise, but monetary policy is showing signs of working to reduce inflation levels, with confidence slowly returning to the market.
“Overall, these figures reflect an uncertain economic environment where households and businesses remain wary and with good reason. Sustained growth will require not just macroeconomic improvement, but better leveraging of technology and data to enable smarter, faster transactions. Innovation is not just a nice-to-have, but an essential component to the recovery of the market. Integrating solutions like AI could dramatically streamline processes and reduce costs, contributing to a stronger outlook for 2024.”