HMRC figures reveal a mixed picture as transactions dip month-on-month, with brokers pointing to Budget jitters and volatile mortgage pricing
HMRC data for August 2025 paints a mixed portrait: while property transactions were 2 per cent higher than a year ago, they were also 2 per cent lower than July’s figures. The month-on-month pullback interrupted a three-month upward run and underlines the delicate footing of current housing market momentum.
Mortgage approvals followed the same trend. The Bank of England recorded 64,680 green-lit loans for house purchase in August, down from 65,161 in July, hinting that that buying activity is already responding to those softer transaction numbers.
To put today’s levels in perspective, before the pandemic UK monthly residential transactions often hovered above 100,000 (non-seasonally adjusted). According to HMRC’s monthly property statistics, those seasonal peaks above 100,000 were not unusual in 2016–19, before the market was upended by lockdowns and rate volatility. That baseline underscores how even with year-on-year growth, the market is still operating beneath its earlier highs.
Uncertainty holds buyers back
Brokers say the looming Autumn Budget and attendant tax speculation are stalling decision-making in the run-up to November. Guy Nyirenda of Altura Mortgage Finance argues it’s uncertainty more than anything else keeping buyers on the sidelines. He points to proposed changes to stamp duty, possible shifts in inheritance tax, and wider fiscal policy as key deterrents:
“All these potential changes are playing on people’s minds … many feel now is not the right time to transact. Once households know where they stand, even just for the next year, we’ll see confidence come back.”
Until buyers have clearer visibility on costs, he suggests, it will be difficult for the market to push forward.
Lenders’ pricing strategies aggravate unpredictability
But it isn’t only buyers who are injecting volatility. Alan Greenin of Marble Financial Planning believes that frequent adjustments in mortgage pricing by lenders create a “stop-start” rhythm that unsettles activity. Borrowers, he said, have largely acclimatised to higher interest rates; what unsettles them is the back-and-forth of rate movements to manage lender capacity and demand.
“When a lender has the cheapest rate it gets flooded with applications. Service levels dip, so they put the price up, and another lender takes the spotlight… It’s like turning the taps on and off.”
He sees August’s dip as partly the delayed effect of rate swings in May and June, when banks and building societies were battling shifts in swap rates and pipeline backlogs.
What’s needed for recovery
Many in the mortgage sector say the Budget must deliver fiscal clarity, especially around property taxation, if buyers are to return en masse. But the path to recovery may not only depend on policy. Broker confidence also hinges on smoother lender behaviour: more predictable and stable product pricing could bridge the gap until clear policy direction arrives.
If November’s announcements deliver both certainty and better mortgage conditions, the stage could be set for renewed transaction growth. If not, the market may linger in limbo amid hesitation and tactical rate resets.
