There were 96,710 residential property transactions in July, 2% lower than June and 1% lower than July 2025, the latest HMRC figures show.
On a non-seasonally adjusted basis, transactions were 5% higher than July 2025 and 3% higher than June.
Melanie Spencer, growth director at Target Group, commented: “While up on a non-seasonally adjusted basis, today’s dip shows just how sensitive the market remains to pressure, particularly with plenty of external noise and disruption in the wider economy. While there will be those undeterred by all the headlines and pushing on with plans, they remain the minority. In reality, higher borrowing costs and uncertainty around inflation, mortgage pricing and the wider economy has made households more cautious about committing to a purchase - despite good efforts from both lenders and brokers.
“It’s always important to remember these figures reflect decisions made weeks or even months ago. The bigger concern for the months ahead will be how current mortgage pricing and rate volatility, along with economic uncertainty and general borrower confidence feed through into new offers and mortgage applications. That forward-looking picture looks finely balanced and depends massively on factors outside the control of both lenders and potential borrowers."
Richard Sexton, commercial director at HouzeCheck, said: “The latest figures are a reminder that the housing market is still moving cautiously. But relatively modest changes in transaction volumes should not be mistaken for lower expectations: buyers and sellers still want transactions to move quickly and with as little uncertainty as possible.
“Periods of slower activity also give the industry an opportunity to look closely at where friction remains. If consumers are already hesitant to move, unnecessary delays, duplicated information and uncertainty around a property's condition can make the decision to proceed harder still.
“For brokers and lenders, the priority should therefore remain on giving customers greater certainty as early as possible. Faster, more consistent surveying can play a role here by getting reliable information into the transaction sooner and reducing the risk of problems emerging after significant time and money have already been invested.”
Richard Pike, sales and marketing director at Phoebus Software, commented: “A fall in transaction numbers underlines just how cautious the housing market has remained through the spring and early summer.
“But these figures need to be treated in context. Transactions are a lagging indicator, largely reflecting decisions made several months ago, so a weaker July number isn’t necessarily a fresh signal about where the market stands today.
“With volumes having been broadly stable in recent months, the key question is whether this is a temporary dip or the beginning of a more sustained slowdown.
“The next few months will be more revealing, as the data begins to capture decisions made against the backdrop of more recent mortgage rate movements and continued economic uncertainty.”
Jason Tebb, president of OnTheMarket, added: “The ongoing uncertainty created by the Middle East conflict and its impact on energy prices and interest rates continues to dampen activity.
"However, the market’s underlying resilience remains in evidence. Buyers and sellers who need to move regardless are adapting to changing circumstances and continuing to proceed. The Bank of England’s decision to hold interest rates this year, coupled with a number of lenders easing mortgage pricing in recent weeks, is helping with affordability at a time when the cost of living remans high.
"The slowdown in annual growth in average property prices suggests expectations are becoming more aligned with market conditions. If the stock coming to market in the autumn is priced appropriately from the outset, this should help transactions progress more quickly and smoothly.”
