RICS’s January survey shows weaker falls in enquiries, sales and prices
The UK housing market is showing early signs of stabilisation, with surveyors reporting the least negative readings in several months, according to the latest RICS UK Residential Market Survey.
While overall activity remains muted, the latest responses suggest that the downturn in buyer demand, agreed sales and prices is easing. Survey participants also expect sales and prices to firm over the next year, even as short‑term conditions stay challenging.
New buyer enquiries improved for a third consecutive month in January. The net balance rose to -15%, from -21% in December and -29% in November, indicating that the downward pressure on demand is softening. Agreed sales showed a similar pattern, with a net balance of -9% – the least negative reading since June 2025.
At the national level, house prices appear to be edging towards a plateau. The net balance for prices over the past three months stood at -10%, up from a low of -19% in October 2025. Although price momentum remains weak, the steady improvement since the autumn points to a possible inflection in the cycle.
Regional trends remain uneven. Respondents reported the firmest price growth in Scotland and Northern Ireland, with ongoing upwards pressure also seen in the North West and the North of England. London, the South East, South West and East Anglia continue to underperform the national picture, reflecting affordability constraints, but even these regions have seen a modest easing in weakness.
Forward‑looking indicators have strengthened. The net balance for sales expectations over the next three months edged back to +4%, suggesting limited near‑term growth as caution persists. However, the twelve‑month outlook for sales climbed to +35%, the strongest reading since December 2024.
Price expectations followed a similar path, with a net balance of +43% of respondents anticipating higher prices over the next year – the most positive figure since February 2025.
“Buyer enquiries and sales agreed, particularly for smaller houses and not so much flats, have improved considerably since the beginning of the year,” said Jeremy Leaf (pictured right), north London estate agent and a former RICS residential chairman. “This consistently-reliable lead indicator of change confirms what we have seen in our offices after a slower than expected few months – confidence is on the up.
“However, an increase in listings as well as appraisals, ongoing worries about the economy and slow pace of anticipated mortgage rate cuts, are keeping transaction lengths up and prices in check.”
In the lettings market, tenant demand edged higher over the three months to January, ending two consecutive quarters of flat or negative readings. Landlord instructions, however, remained firmly in negative territory, underlining ongoing supply constraints. Respondents therefore expect further rental growth in the near term as the imbalance between demand and available stock persists.
“Although we have found more tenants are ‘feeling the pinch’, the shortage of stock prompted particularly by landlords still selling up, has meant rents are holding up relatively well,” Leaf said.
“Disappointingly, we are seeing little appetite from would-be investors for new buy-to-let opportunities so the supply-demand imbalance and upward direction of travel for rents is unlikely to change in the near term at least.”
Overall, the January findings indicate that the housing market may be moving into the early phase of a gradual recovery. Although affordability pressures, economic uncertainty and regional imbalances remain, the improvement in sentiment points to the possibility of firmer conditions as the year progresses.
“There are early signs that market conditions may be improving after a challenging period, although activity levels are still subdued, meaning any recovery is likely to be gradual,” said RICS chief economist Simon Rubinsohn (pictured right).
“While the strengthening 12-month outlook is encouraging, near-term expectations remain relatively soft, reflecting ongoing economic uncertainty.
“Whether this tentative improvement develops into sustained momentum will depend heavily on the trajectory of mortgage rates and broader macro confidence over the coming months.”
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