HMRC says this year‑on‑year increase follows a larger year‑on‑year increase seen last month and reflects lower transaction levels in April and May 2025, when activity fell following changes to SDLT thresholds.

Transactions were brought forward into March 2025 ahead of the changes, leading to fewer completions in the following months.

The data shows the provisional non-seasonally adjusted estimate number of UK residential transactions in May stood at 92,390, 7% higher than April’s figure and 13% above May last year.

It also found that the provisional seasonally adjusted estimate of the number of UK non-residential transactions in May is 10,080.

This is marginally lower than the same period 12 months ago and marginally higher than April this year.

Meanwhile, the provisional non-seasonally adjusted estimate of the number of UK non-residential transactions in May is 9,380, 4% lower than May last year and 5% lower than April 2026.

Commenting on the latest data, Quilter mortgage expert Karen Noye says: “While the annual comparison appears encouraging, it is heavily skewed by the distortions caused by last year’s Stamp Duty changes, which depressed activity in spring 2025 as buyers rushed through purchases to beat the deadline earlier than normal. As such, the year on year increase overstates the underlying strength of the housing market.”

“A clearer picture emerges when this is viewed alongside yesterday’s Bank of England’s money and credit data. This points to a marked slowdown in housing activity feeding into the pipeline.”

Noye adds: “The market is not short of underlying demand, but a significant proportion of buyers are choosing to delay decisions in the face of affordability pressures and uncertainty around the path of interest rates.”

“These figures are also inherently backward looking, reflecting deals agreed earlier in the year. More recent developments, including heightened geopolitical tensions and the subsequent volatility in swap rates and mortgage pricing, are not yet fully captured.”

“While the emergence of a ceasefire may provide some reassurance and could prompt a modest uptick in buyer interest, the outlook remains fragile.”

Also commenting, Search Acumen managing director Andrew Lloyd states: “The latest decline indicates that falling market confidence is now translating into weaker deal flow. This is a negative signal for the economy, particularly as seasonal transaction levels at this time of year are typically more resilient. New political uncertainty tied to a new Prime Minister is also likely to weigh on near-term performance.”

Lloyd adds: “Moving forward, however, there are several key hurdles the sector needs to navigate, not least of which is the appointment of a new Prime Minister.”

“Questions around retrofit targets, grid capacity, business rates, and potentially damaging fiscal policy from a new Chancellor could all easily hit the brakes on growth if mishandled. As a result, investors are likely to become more selective, focusing on sectors with resilient income profiles, such as prime offices and data infrastructure.”

“The next question will be whether buyers accept that certainty isn’t forthcoming and move ahead anyway, and, if so, what the future Autumn Budget will look like for a government determined to shake up property taxes and leave its mark.”

“Growth will come from unlocking transactions and development, which have historically responded more effectively to fiscal incentives rather than to restrictive policy measures.”