Tracking property completions in near real time with CHAPS purpose codes

Simran Mehta and Valentina Macchiati

UK property transactions can be identified and observed directly within minutes of payment settlement using CHAPS, the UK’s high-value payment system. Taking advantage of the migration to the ISO 20022 payment standard in June 2023, and the introduction of mandatory purpose codes from May 2025, we have developed a real-time indicator of housing activity. We find that this closely aligns with existing official housing market statistics and therefore can act as a reliable real-time indicator of these statistics, superseding previously developed value-based proxies.

How well does CHAPS track official statistics?

CHAPS participants are required to provide purpose codes for property transactions. The most frequently used of these is ‘PCOM’, which corresponds to the property completion payment.

In the UK, property market activity is often measured through HMRC and Office for National Statistics (ONS) statistics. These datasets capture different dimensions of the housing market; HMRC provides a measure of property transaction activity, whereas ONS statistics focus specifically on residential property transactions. HMRC statistics are based on Stamp Duty Land Tax (SDLT) returns (which is paid after completion) and exclude transactions below £40,000. They are published with a one-month lag, with the latest month and the previous two months reported on a provisional basis. In contrast, ONS statistics are based on completed and registered residential property transactions which leads to a three-month lag in publication.

To assess how well payments with the PCOM purpose code capture completed property transactions, we compare PCOM volumes with HMRC’s property transaction series. Our analysis finds that total PCOM volume is an excellent real-time indicator of property transactions and provides an accurate measure of completed residential transactions in the UK.

Chart 1 shows close alignment between CHAPS PCOM volumes and HMRC property transaction data. From May 2025 to August 2026, there were 1.6 million uses of the PCOM purpose code, which is equivalent to over 99% of the residential property transactions reported in HMRC statistics over the same period. The mean absolute percentage difference between monthly PCOM volumes and monthly HMRC residential property transactions is 2.8%, while the Pearson correlation is 0.96, demonstrating there is a strong alignment between them. Since PCOM can be used for a broader range of property-related transactions than those covered by residential property statistics alone, extending the comparison to HMRC total property transactions (residential and non-residential) yields corresponding values of 9.9% and 0.96. This comparison suggests that our PCOM series is a useful indicator of aggregate property market activity.

Chart 1: Comparison of monthly volumes of CHAPS PCOM transactions to HMRC monthly data on property transactions

Notes: Compares monthly volumes of CHAPS PCOM payments (green), alongside HMRC monthly property transaction volumes completed in the UK with value of £40,000 or above, including total property transactions (orange) and residential property transactions (blue). HMRC data is available until August 2026, including provisional data from June 2026; CHAPS PCOM data until September 2026. The x-axis represents months, and the y-axis shows transaction volumes in thousands.

For both series (looking at HMRC total, or HMRC residential only), our analysis suggests that PCOM volumes track property completions closely, regardless of coverage. Furthermore, while HMRC data is published with a lag (delayed by one month, four if we exclude provisional data), PCOM provides a near real-time signal, meaning that CHAPS payments data could capture turning points in property market activity as they emerge.

We expect there to be some differences between the two series because they both consider slightly different sets of transactions. CHAPS may include property-related transactions below £40,000, or those not captured by SDLT returns, while HMRC may capture property purchases settled through other payment rails, funded from non-UK bank accounts, or accounted for using other property-related purpose codes.

What do payment timings reveal about housing activity?

While we do not yet have sufficient data to develop a seasonally adjusted series, the granularity of payments data in the period May 2025 to September 2026 allows us to look at other seasonal features of the data. We can confirm the patterns align with expectations:

  • Property transaction activity falls sharply over the Christmas and New Year period, with average daily PCOM volumes 57% lower than during the rest of the year. This reflects a seasonal pattern, in which transactions are often brought forward and completed before the holiday period.
  • Most people want to move before the weekend; Fridays account for 36% of transactions.
  • Transactions are concentrated in the morning; 56% of transactions are settled before midday; giving you the afternoon to unpack!

Housing payment values: coverage and limitations

A key advantage of purpose codes is that they allow us to identify property completion payments directly, rather than relying on value-based proxies. Therefore, the PCOM series provides a more complete picture of property market activity across the full distribution of property transactions, while offering a more precise measure by isolating only property-related transactions.

In the 12 months to July 2026, over two-thirds of PCOM property completion payments by volume sit within the £100,000 to £500,000 range, in line with the average UK house price. However, this range only corresponds to 50% of the total value of property payments settled, with the top 1% of payments by value accounting for more than 17% of the total PCOM value settled in CHAPS. This highlights the importance of capturing higher-value transactions, which were likely to be excluded under the previous value-based proxy.

Across the same period, the ONS reports that the average house price in the UK was £273,000, while the average value of a CHAPS PCOM property payment was £344,000. Here, it’s key to understand that the two measures are not directly comparable. The ONS chart is derived from their UK House Price Index, which is based on residential property transactions and uses a mix-adjusted methodology to account for differences in the characteristics of properties sold over time. In contrast, PCOM payments capture a broader set of property transactions and reflect the property completion payment value, making the average more sensitive to high-value transactions.

More broadly, while CHAPS data can provide timely insights into housing market activity, it does not contain the detailed property-level information required to construct traditional house price indices, such as those produced by the ONS, Nationwide and Lloyds. These indices adjust for differences in property characteristics through hedonic regression methods, ensuring the index reflects underlying price movements rather than changes in the composition of properties sold. As this information is not available within CHAPS payments data, CHAPS is better suited to analysing transaction patterns and market activity, limiting its ability to directly measure house price inflation or replicate established house price indices.

Conclusion and further work

The introduction of mandatory purpose codes has transformed CHAPS payments data into a powerful tool for real-time monitoring of the property market. By directly identifying housing transactions, the resulting PCOM series provides a more accurate and timelier indicator of property completions than previous value-based proxies. This data can also help the Bank monitor intraday CHAPS property transaction flows and identify and manage operational risks. The analysis presented in this article is based on using payment settlement dates, values and purpose codes; it does not use any personal information.

With transaction-level timestamps, PCOM data enables housing market patterns, shifts and developments to be monitored as they emerge. For example, we observed a peak in PCOM volumes at the end of March 2025, in line with changes to SDLT thresholds, demonstrating the potential of CHAPS data to capture shifts in market activity in near real time.

Looking ahead, we could explore relationships with mortgage related activity by enriching CHAPS data with complementary data sources, such as Product sales data. This would allow us to enhance real-time monitoring and support us to explore further housing insights.

A footnote on previous work

Previous analysis on CHAPS housing used a value-based CHAPS proxy to track housing activity, which showed broad alignment with HMRC trends when comparing year on year differences between 2007–16. However, this approach relied on assumptions in the absence of more granular data and has been less effective in recent years, with the relationship weakening from 2023 onwards. The introduction of purpose codes and enhanced CHAPS granularity now allows for a more direct and precise view of underlying housing activity, reducing reliance on proxy-based approaches which include non-housing transactions and exclude high value transactions.

The authors are grateful to James Sanders and Sam Cuthbertson for useful discussions and comments.

Simran Mehta and Valentina Macchiati work in the Bank’s Wholesale Payment Division.

If you want to get in touch, please email us at bankunderground@bankofengland.co.uk or leave a comment below.

Comments will only appear once approved by a moderator, and are only published where a full name is supplied. Bank Underground is a blog for Bank of England staff to share views that challenge – or support – prevailing policy orthodoxies. The views expressed here are those of the authors, and are not necessarily those of the Bank of England, or its policy committees.

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