UK home sales fall month-on-month in ‘significant’ dip since summer
HM Revenue and Customs (HMRC) announced that house sales in the UK experienced their first “significant” decline since last summer in January. A total of 94,680 house sales were recorded across the UK. This figure represents a 5% decrease from 99,710 transactions in December 2025. It was also “marginally” (less than 1%) lower than the 95,430 sales in January last year.
The revenue agency’s report stated: “Seasonally adjusted figures for housing transactions in January 2026 were 5% lower, falling from 99,710 in December 2025 to 94,680 in January 2026. This marks the first significant decline in transactions after a period of stability since the summer of 2025.”
Nick Leeming, chairman of Jackson-Stops, said: “January data shows the first significant decline in activity since the summer and points to a slight cooling in momentum.
“Following a period of instability towards the end of last year (the fourth quarter), buyers remain cautious, weakening confidence in the market.
“Despite this, some completions have been carried over from the second half of 2025 and we should see these expressed in the data in the coming months.
“Momentum is building below the surface, particularly in northern markets. Our Alderley Edge branch, for example, saw bourses double in January, showing committed buyers are back.”
“Demand remains selective and value-driven. Homes priced correctly attract competition and move towards trade-ins, while overly ambitious pricing is likely to slow down the sales process.
“The overall economic picture is becoming more supportive. Falling inflation and the possibility of the Bank of England cutting base rates next month will ease borrowing costs and improve access to finance.”
Ian Futcher, financial planner at asset manager Quilter, said: “Lenders are already reducing fixed-rate deals in anticipation of cuts by the Bank of England later this year, and the market is increasingly priced in for a cycle of gradual easing.
“If inflation continues to fall, there is a realistic possibility that average mortgage interest rates could fall further in the spring and summer. This would gradually increase affordability and could release some of the pent-up demand that has been sitting on the sidelines since early 2024.”
“But households remain cautious for now. Buyers are awaiting clearer evidence that more rate cuts are coming and that any downward momentum in mortgage prices will be sustained rather than tactical.”
“The flexibility in the December figures suggests trading is being driven by need rather than opportunism, but an improving rate outlook would provide exactly the confidence boost needed to lift activity out of the holding pattern.”
Nicky Stevenson, Managing Director of Fine & Country, said: “January is traditionally a quieter time for the market as many buyers and sellers take a breather after Christmas before turning their attention back to moving plans.
“Households re-evaluate their budgets and work routines in January, so a 5% month-on-month decline points to seasonal patterns rather than any loss of confidence in the market.
“The fact that transactions are ever so slightly lower than a year ago is actually an encouraging sign. This shows that the market remains generally stable, with demand remaining stable. This time last year, there was some activity in the market given the changes to stamp duty in April 2025.”
Ryan McGrath, second installment mortgage manager at Pepper Money, said: “Many homeowners are still sitting on historically low fixed rate mortgages, making the financial case for moving less attractive.”
Tom Bill, Knight Frank’s head of UK housing research, said: “Activity is expected to pick up in the coming months as suspended schemes are reactivated and mortgage rates fall.”
Amy Reynolds, sales director at London-based estate agent Antony Roberts, said: “Although volumes are down compared to busier years, we are seeing activity picking up as determined buyers re-enter the market.
“There is clear pent-up demand from those who paused decisions last year, and many are now keen to take action before conditions change again.”
“The increase in the number of sellers bringing their homes to the market this spring will keep prices in check to some degree, which will further assist first-time buyers and increase transactions,” said Jason Tebb, president of OnTheMarket.
Iain McKenzie, chief executive of the Association of Property Professionals, said: “Although transaction volumes may have softened at the start of the year, the outlook for 2026 remains positive.”
