Property transactions slowed at the start of 2026, with both residential and commercial activity easing in January, according to HM Revenue & Customs (HMRC) data.
Seasonally adjusted figures show 94,680 residential transactions in January 2026, slightly below January 2025 and 5% lower than December 2025. Unadjusted figures totalled 79,880, a 3% decrease on the same month last year and a 24% drop from December 2025, reflecting the typical year-end to new-year slowdown.
Non-residential transactions also eased. Seasonally adjusted non-residential activity reached 9,960 in January, up 3% on January 2025 but down 6% on December 2025. On a non-adjusted basis, there were 8,470 transactions, 2% lower than a year earlier and 28% below the previous month.
Iain McKenzie, CEO of The Guild of Property Professionals, believes the latest HMRC property transaction data for January highlights a modest seasonal slowdown rather than any underlying weakness in the housing market.
He said: “Encouragingly, the broader economic backdrop is becoming more supportive. Inflation has eased to 3% in the year to January, its lowest level since March 2025, and, while still above the Bank of England’s 2% target, the downward trajectory strengthens the case for a base rate cut in the coming months. Combined with wage growth and improving mortgage affordability, this is laying the groundwork for renewed momentum.
“We are already seeing lenders respond to market expectations, with mortgage rates trending downwards. More attractive deals, particularly for buyers with larger deposits, should help unlock pent-up demand and encourage movers who delayed decisions during the final quarter of 2025.
“While transaction volumes may have softened at the start of the year, the outlook for 2026 remains positive. With house prices forecast to rise by a modest 3.3% and supply levels increasing, buyers will benefit from greater choice and improved negotiating power. As confidence builds and borrowing costs continue to ease, we expect activity to strengthen through the spring and summer, with sales volumes picking up as the year progresses.”
Tom Bill, head of UK residential research at Knight Frank, commented, “Transaction numbers were 5% below the five-year average in January as the impact of November’s Budget continued to reverberate. Activity should recover in coming months as plans put on hold are reactivated and mortgage rates head lower. However, a Labour leadership challenge would cause another period of uncertainty and hesitation in the housing market, a prospect that appears almost inevitable after the by-election result in Gorton and Denton.”
Nick Leeming, chairman of Jackson-Stops, pointed out that January’s data shows the first notable dip in activity since the summer, suggesting a slight cooling in momentum.
He remarked: Buyers remain cautious following a period of instability towards the end of Q4 last year, which has tempered confidence across the market.
“Despite this, some completions have rolled over from H2 2025 and we should see these expressed in the data in the coming months.
“Momentum is building beneath the surface, particularly in northern markets. Our Alderley Edge branch, for example, saw exchanges double in January, showing that committed buyers are returning.
“Demand remains selective and value-driven. Homes priced accurately are attracting competitive interest and progressing to exchange, while over-ambitious pricing is likely to slow the sale process.
“The wider economic picture is becoming more supportive. Falling inflation and the prospect of a Bank of England base rate cut next month should ease borrowing costs and improve access to finance.”
Amy Reynolds, head of sales at Antony Roberts, added: “Although not yet reflected in the official data, which is a little dated, transaction levels are starting to reflect improving confidence among buyers and sellers.
“While volumes have been subdued compared to more buoyant years, we’re seeing activity pick up as committed buyers re-enter the market.
“There is clear pent-up demand from those who paused decisions last year, and many are now keen to move before conditions shift again. As a result, agreed sales are increasing and well-priced properties are attracting competition.”
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