"January 2021 was a tough act to follow given the massive surge in transactions caused by the stamp duty holiday and the changing property needs brought on by the pandemic."
On a seasonally adjusted basis, the number of transactions totalled 106,990, 10.6% lower than January 2021 and 5.1% higher than December.
Jeremy Leaf, north London estate agent and former RICS chairman, said: "Rapidly rising asking prices are one thing but transactions are quite another and always a better measure of property market health.
"These numbers are no exception and confirm clearly what we have been seeing in our offices – the continuing lack of stock is constraining activity and only supporting the acceleration in prices.
"The good news is that listings are on the up, prompted by the increase in energy prices and interest rates. This should help to better balance supply and demand, as well as keep prices in check."
Ross Boyd, founder of Dashly, commented: “January 2021 was a tough act to follow given the massive surge in transactions caused by the stamp duty holiday and the changing property needs brought on by the pandemic. The property market remained strong in the closing stages of 2021 and that has continued into 2022, but transaction levels are being hindered by the sheer lack of supply. The lack of stock, coupled with the cost of living crisis, interest rate rises and impending tax hikes means transactions are likely to be steady rather than stellar in 2022."
Andrew Montlake, managing director of Coreco, said: "The stamp duty holiday put the market on steroids when it was launched and the tax relief, coupled with an abject lack of stock, explains why January 2022 was down in comparison to the same month last year. There are many red flags ahead in 2022, especially with rising interest rates and soaring inflation, but borrowing rates remain exceptionally low and rents are soaring. People are more keen than ever to get out of the rental market and own and that will be a major driver of transactions in 2022."
Emma Cox, MD of real estate at Shawbrook, added: “Anyone that’s been scanning property websites or estate agent windows will tell you that supply in the market is low, and competition fierce. This limited supply has prompted house buyers to act quickly, and transactions remain high. However, with prices continuing to soar and wage inflation failing to keep pace with the rising cost of living, there are concerns that transactions will begin to tail off later this year. Indeed, more and more people are being shut out of the market, with the average house price in the UK reaching £275,000 and in London a staggering £521,000.
"While, some lenders are introducing 95% LTVs to help first time buyers onto the ladder, more needs to be done to support the property market going forward. Supply is a key issue, and we need to see more commitment from the government in order to boost the housing stock in the UK and support more buyers with their property ambitions.”
