RICS says near-term expectations brighter  

The UK housing market continued to show weak momentum in June, with the impact of inflation, the cost of living, domestic political uncertainty and global conflicts all adding to market worries, according to the latest Royal Institution of Chartered Surveyors (RICS) UK Residential Market Survey. However, the tide may be turning, it says.

Although new buyer enquiries remained negative, with a headline net balance of -29%, this was a marginal improvement on the -34% recorded in the previous two months. It was also the least negative reading since February. Newly-agreed sales also remained subdued, posting a net balance of -32%, compared with -35% previously.

Near-term sales expectations improved to -16%, up from a recent low of -34% in March. Respondents expect sales volumes to remain broadly flat over the next twelve months, with a net balance of +1%.

New instructions dropped to -23% from -10% previously, which marked the weakest reading in over a year. Market appraisals also declined.

Headline price balance unchanged

The headline price balance came in at -33%, broadly unchanged from -34% in May and -35% in April. Near-term price expectations also remain subdued, although less negative than before, moving to -32% from -44%. Over the next twelve months, a net balance of +8% of respondents expect prices to rise, up from +6% previously.

In the lettings market, tenant demand picked up, with the headline net balance rising to +18%, the strongest reading since May 2025. Landlord instructions remained negative at -18%. Against this backdrop, rents are expected to continue rising, with projected rental growth over the next twelve months standing at around 2.5%.

RICS head of market research and analysis, Tarrant Parsons, said: “June’s survey results offer some cautious encouragement that the worst of the slowdown in market activity may be beginning to pass, with several key indicators moving in a less negative direction for a second consecutive month. That said, any nascent improvement remains fragile and is now being tested by renewed political uncertainty on the domestic front.”

Rachel Springall, finance expert at Moneyfactscompare.co.uk, said: “Falling mortgage rates could encourage prospective buyers, but affordability pressures and wider economic uncertainty can create caution, with some sitting on the fence until rates fall further.”

Jeremy Leaf, north London estate agent and a former RICS residential chairman, said that those needed to move were: “negotiating hard and trying to anticipate the market’s direction of travel. The net result is prices and activity are holding up better than we dared hope, although we are not expecting a significant summer rebound, bearing in mind these distractions are likely to continue for a few more months at least.”