November saw the Office for National Statistics issue a positive report: that, in October, transactions had risen 2% on a monthly basis to 108,480.

However, many brokers were quick to discount this news. As Riverside Mortgages owner Luke Shaw says: “These figures lag economic reality. On the front line, it’s now a very different story. The phones have stopped ringing, buyers are holding off and, with the World Cup and Christmas upon us, most people have decided to sit tight and wait until next year.”

Many people will want to enjoy time off at Christmas, and pick up their property hunt next year

Further statistics provided by the Bank of England (BoE) in the form of its October Money and Credit report go some way to backing this up. This detailed £4bn of net mortgage debt taken out in September — a monthly fall of 32% and the lowest amount recorded since November 2021.

And approvals for new mortgages, numbering just under 59,000, saw a monthly fall of 10%.

Added to this are new figures from Zoopla, which show that demand has dropped 44% since the ill-fated mini-Budget, and Nationwide data shows a monthly house-price drop of 1.4% in November — the biggest fall since June 2020.

Hargreaves Lansdown senior personal finance analyst Sarah Coles says in some areas of the country sales are down as much as 50%.

The issue today is confidence in the market, which has taken a battering

She adds: “Even once a sale is agreed, the proportion of sales that fall apart… has hit 15%.”

Many brokers to whom Mortgage Strategy spoke believe the slowdown in house-purchase business they have been experiencing at the tail end of 2022 could turn into a much longer freeze — perhaps even an ice age.

Mortgage broker Rachel Dixon explains: “Normally — and probably for the past 10 years — December has been as busy as the rest of the year. Since the rate rises, it’s almost as if the tap has been turned off.”

She continues: “When rates rose in October, I had a rush of clients wanting to secure deals; this could be why I [was] less busy in November as I did twice as much then.

“However, [in November] I’ve had many purchases fall through, and clients who were going to buy have now delayed until next year, with a ‘Wait and see what happens’ attitude.”

First-time buyers were fighting for properties not long ago

Dixon believes brokers should concentrate on the remortgage market to stay busy during 2023. And, again, BoE figures back this up. According to the same Money and Credit report for October, approvals for remortgages ticked up just over 3% to 51,280.

Harmony Financial Services director Imran Hussain confirms that, for him, enquiries from people wanting to move home have “disintegrated”. Coupled with the economic situation, he puts this down to it being the first Christmas for a while with no threat of a lockdown.

“Many people will want to enjoy time off and spend it with family and friends, and pick up their property hunt next year,” he says.

However, 2023 will still be slower in terms of homemovers, in Hussain’s opinion, because of worries over job security and, of course, the rising cost of living. Like Dixon, he says remortgage business remains strong. He also points to action from first-time buyers (FTBs), who he says will be looking to escape a rental market where prices have “gone through the roof”.

Clients who were going to buy have now delayed until next year

On this subject, Premier One Mortgages founder Natalie Hines serves many clients who work in the TV industry. They tend to be young and looking to buy their first home.

“They were fighting for properties not long ago,” says Hines, but with the market tipping towards the buyer this has changed. She says the stamp duty break for FTBs, which will end in 2025, is also prompting first-timers to make offers.

“I do, I really, really do,” replies Hines when asked if she thinks this FTB demand will flow into 2023.

And Verve Financial director Gary Boakes says, while many homeowners are fretting over rising mortgage rates, FTBs don’t necessarily understand what a 2% rate means for their finances.

These figures lag economic reality. On the front line, it’s now a very different story

“If you’re just coming into the market, you won’t have experienced anything different,” he says, adding that buyers are most interested in knowing if they can afford the monthly cost.

He adds that not long ago mortgage rates were pushing 4%, which didn’t stop activity.

“An extra half a per cent to a full per cent won’t have much effect. The issue today is confidence in the market, which has taken a battering.”

Boakes continues: “We will likely see the premium added to housing over the past 12 months disappear, which will help FTBs. And, with many lenders allowing for up to five times income in their calculations, affordability should still be there in 2023.”

Although most people to whom Mortgage Strategy spoke are bracing for a tougher year, it is notable that nobody seemed pessimistic — the opposite, in fact, when the conversation turned to FTBs. A Christmas present for the whole industry.