Buyer’s market ‘will help keep property prices in check’

The housing market remained firmly in buyers’ favour in May as residential transactions edged lower month-on-month, giving purchasers greater negotiating power while helping to keep house price growth under control.

The latest HMRC figures show there were 98,450 UK residential property transactions in May on a seasonally adjusted basis, down 2% from April but 17% higher than the same month last year.

HMRC said the annual increase reflects unusually weak activity in April and May 2025, following changes to Stamp Duty Land Tax thresholds. Many buyers brought purchases forward into March last year to beat the deadline, resulting in fewer completions in the following months.

On a non-seasonally adjusted basis, there were 92,390 residential transactions in May, up 7% on April and 13% higher than a year earlier.

Tom Bill, head of UK residential research at Knight Frank commented, “The clearest signal from the 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.”

Despite the modest monthly decline, market activity continues to hold up against a backdrop of economic and political uncertainty, with buyers and sellers continuing to complete transactions rather than delaying moves.

The Bank of England’s decision to hold the base rate for a fourth consecutive meeting, combined with lower mortgage rates, has also helped support affordability and buyer confidence.

However, with supply continuing to outpace demand in many areas, buyers remain in a strong negotiating position. Industry observers say the current balance of the market is helping to moderate house price growth, providing opportunities for purchasers—particularly first-time buyers—while encouraging sellers to price homes more realistically.

Jason Tebb, president of OnTheMarket, commented: “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 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.”

Nick Leeming, chairman of Jackson-Stops, added: “The 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.

“We continue to see the greatest momentum in family and lifestyle markets, with upsizers driving a significant proportion of activity as households prioritise space, flexibility and long-term value. Although conditions remain more measured than during the post-pandemic market, today’s figures suggest the market is gradually finding a more sustainable rhythm, underpinned by realistic pricing, improving supply and motivated buyers.”