The downturn in the UK housing market may be starting to stabilise, according to a report from the Royal Institution of Chartered Surveyors (Rics). In May, a net balance of 34% of property professionals reported that new buyer inquiries were falling rather than rising. While this still indicates weaker demand, it is the first time since January that the decline has not worsened.
Sales and Prices
The fall in agreed sales remained unchanged in May, with a net balance of 37% of professionals seeing a decrease. Rics noted that this suggests the pace of decline is no longer intensifying. However, sales are taking longer to complete, with the average time from listing to completion reaching 21.5 weeks—the longest since Rics began recording this data in 2017.
House prices are also falling overall, with a net balance of 35% of professionals reporting declines. Regional variations show more pronounced downward pressure in the South East and East Anglia, while Northern Ireland continues to see firm price growth.
Future Outlook
Looking ahead, a small balance of 2% of professionals expect sales to pick up over the next 12 months. While house prices are expected to fall further in the next three months, a balance of 6% of surveyors anticipate higher prices in the year ahead. Mortgage rates have recently been cut by some lenders after rising due to economic uncertainty linked to the Middle East conflict.
Rental Market
The rental market remains under pressure, with rising tenant demand and falling landlord instructions. Separate data from Zoopla shows UK rents for new lets increased by 2.1% annually to April, down from 2.6% a year ago. In areas where average rents are £750 per month or less, rents are rising by an average of 5%—more than double the national average.
Richard Donnell, executive director at Zoopla, commented: "Rent inflation is more subdued across most of the UK’s major cities due to already stretched affordability levels for renters."
Tarrant Parsons, Rics head of market research and analysis, said: "The latest survey data suggest the recent downturn in activity may be beginning to stabilise, with several key indicators broadly holding steady. However, as they remain in negative territory, it would be premature to interpret this as the start of a recovery."
