UK Non-Residential Property Transactions Show Market Volatility in August 2025

August Performance Drops Sharply

Non-residential property transactions in August 2025 totaled 9,190 transactions, representing a substantial 13.1% decrease from July's 10,570 transactions. This marks the steepest monthly decline recorded in 2025 so far, bringing transaction levels to their lowest point since February when just 8,980 transactions were completed.

The August figures also show weakness compared to the previous year, with transactions2% lower than August 2024 on a seasonally adjusted basis, totaling 9,910 transactions. This year-on-year decline suggests underlying structural challenges in the commercial property market persist.

Volatile Market Conditions Throughout 2025

The non-residential property market has demonstrated considerable volatility throughout 2025.March saw the year's peak with 12,340 transactions - a dramatic37.4% surge from February's low of 8,980 transactions. This March spike was largely attributed to buyers rushing to complete deals before stamp duty changes took effect in April.

However, the market quickly corrected in April with a 21.2% decline to 9,720 transactions, followed by a marginal 1.5% drop in May to 9,570 transactions. The market then showed signs of recovery with June posting 7.6% growth to 10,300 transactions and July adding another 2.6% to reach 10,570 transactions.

Market Context and Challenges

The commercial property sector encompasses diverse transaction types including commercial buildings, agricultural land, forests, mixed-use developments, and bulk residential purchases of six or more properties. Industry experts note that current transaction figures reflect completions that typically occur two to four months after initial offers, meaning August data reflects market sentiment from earlier in the year.

Economic uncertainty continues to weigh on the sector, with the Royal Institution of Chartered Surveyors reporting that overall occupier demand remains relatively flat. Office and industrial sectors show modest positive momentum at +2% and +4% respectively, while retail continues to struggle with a -13% reading.

Regional variations are becoming increasingly pronounced, with Central London displaying stronger momentum than national averages. Prime properties are seeing rental growth while secondary markets lag, creating a widening performance gap across asset quality tiers.

Looking Ahead

The average monthly transaction volume for 2025 stands at approximately10,096 transactions, suggesting August's performance represents a significant deviation from the year's trend. With transaction levels ranging from a low of 8,980 in February to a high of 12,340 in March, the market has demonstrated a 3,360-transaction swing throughout the year.

Market participants remain cautiously optimistic about prime office and industrial properties, expecting solid rental and capital value growth, while alternative commercial real estate sectors including data centers and life sciences assets are anticipated to outperform. However, ongoing policy uncertainty and international economic pressures continue to create headwinds for sustained growth.

The provisional nature of August's figures means revisions are likely over the coming months as additional transaction data becomes available, though historically these adjustments tend to be relatively modest after approximately three months.