Search Acumen (property data insight and technology provider) comments on HMRC’s property transactions data for October 2023:
- The seasonally adjusted estimate of UK residential transactions in October 2023 shows a 3% decrease compared to September 2023. However, residential transaction volumes are now 21% behind where they were at the same point last year.
- The seasonally adjusted estimate of UK non-residential transactions in October 2023 shows a 3% increase compared to September 2023, but year on year commercial property transaction volumes are marginally (less than 1%) below the level seen in October 2022.
Andy Sommerville, Director at Search Acumen, the property data and insight provider, comments:
“These figures are indicative of the macro-economic conditions currently dictating the market. Despite some cause to be positive about the economic progress we have made through 2023, we haven’t turned the corner yet.
“The OBR recently cut its growth outlook for the UK for 2024 and 2025, the Governor of the Bank of England has reiterated that he does not see interest rates being cut for the foreseeable future and inflation remains double the Bank of England’s target rate meaning that, while we have made undoubted economic progress, people don’t feel any better off yet and may not for some time. Those macro-economic conditions, particularly the likelihood of very high borrowing costs for some time to come, mean that sustained growth may still be a way off for both the residential and commercial markets. In that context house buyers, homeowners and investors across the residential and commercial property sectors will need to continue to be discerning in their asset selection and asset management decisions, looking at locations and asset classes with particular dynamics that enable them to outperform.
“Investors that succeed in a challenging market will be those that prioritise developing more intelligent data driven insights and leveraging technology to improve efficiency and decision making. The other thing that needs to happen to encourage growth is a better transaction process that facilitates more efficient and cheaper buying and selling of commercial and residential real estate. Particularly in more challenging economic conditions, protracted transactions which are slowed down by lack of data, resources or manpower can derail a perfectly viable deal. We can’t be in that position going into 2024, especially with the range of technologies we have at our fingertips. It was fantastic to see the Chancellor confirm in his Autumn Statement an addition £3 million to digitise local council data and develop new technological solutions to speed up residential transactions. We hope that signals further investment from both industry and government to develop and integrate new technologies, particularly game-changing innovations like AI, which could dramatically speed up transaction times, saving individuals and businesses a huge amount of time and money, and creating a sector that’s better primed for growth.”
