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HOUSE SALES DROP BY NEARLY 40% SINCE 2021

HOUSE SALES DROP BY NEARLY 40% SINCE 2021

HIGH COST OF LIVING & INTEREST RATES EQUAL LESS UK SALES

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House sales drop nearly 40% since 2021

According to new research, property sales in the UK have fallen by almost 40% since 2021. This is due to the Bank of England having steadily increased their interest rates since then, with the rate climbing to 4.25% recently – the 11th consecutive rise.

There were on average around 72,785 property sales every month in the UK between December 2021 and November 2022.

On this page, we will explain more about why sales have dropped, and which areas have been worst affected.

Find out more about the recent interest Bank of England rate rise and its impact on mortgages and the housing market.

Why have house sales dropped?

With interest rates on a steady increase over the last year, many new buyers and home movers will have been understandably put off by higher prices.

Rates initially increased in December 2021 from 0.1% to 0.25%, before increasing again in February 2022 to 0.5%. During the course of 2022, rates continued rising and hit 3% in November. This was the largest rate rise since the late 80s and the figure now stands at 4.25%. This has led to mortgage repayments rising by nearly 60% each month for the average homeowner.

This combined with the UK cost of living crisis has seen house sales plummet over the last couple of years. The number of houses being sold each month has dropped by a staggering 23,946 properties, from a previous average of around 96,732 sales each month – a 25% decrease.

Property sale decreases by region

Here we have the main regions that have been affected by a drop in house sales, and how much sales have decreased:

  • East England – 29.8%
  • East Midlands – 25.6%
  • London – 26.8%
  • South East – 30.2%
  • South West – 29.9%

Top 10 areas affected

Here we have the areas that have been hardest by lower sales, most of which have seen property prices increase since the start of the pandemic.

  • Havering (East London) – 37.9%
  • Hamblestone (North Yorkshire) – 37.5%
  • Harborough (Leicestershire) – 38.8%
  • Maidstone (Kent) – 37.4%
  • Malden (Essex) – 39.6%
  • Mid-Suffolk – 40.1%
  • Test Valley (Andover) – 37.1%
  • Torridge (Devon) – 39.2%
  • Uttlesford (Cambridgeshire) – 39.8%
  • West Oxfordshire – 39.7%

Scotland is the least affected area in the UK, which is good news for sellers and buyers in that region.

Will property sales increase in 2023?

It is hard to say for certain when sales will increase back to previous levels. It is predicted that property prices will fall by another 10% by mid 2022, which could encourage more people to buy.

It is however also true that mortgage approvals have been reducing since the higher interest rates began. If you have been struggling to find a lender to approve your mortgage, it could be worth speaking to a specialist broker for extra help.

Our team of highly skilled EXPERTS have years of experience in all types of mortgages, from buy to let mortgages, first time buyer mortgages and more.

Learn more about the predicted fall in house prices.

Stay informed about all the latest home and mortgage news in our News & Blogs section.

Useful resources

Bank of England – Interest Rates and Bank Rate

Bank of England – Official Bank Rate history

Gov.uk – UK monthly property transactions commentary

Office for National Statistics- UK House Price Index: January 2023

Gov.uk – UK House Price Index for January 2023

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