Editor's note: This brief was summarised by The Property AI Newsroom from a report by Mortgage Strategy. Read the original article for full details.
RICS: Buyer Demand and Sales Stay Negative, Rental Demand Rises in May
Buyer demand and agreed sales remained in negative territory in May, according to the latest index from the Royal Institution of Chartered Surveyors (RICS). The report also found that tenant demand and rental expectations continued to rise, while transactions are taking longer to complete.
The RICS index showed that new buyer enquiries recorded a net balance of -34% in May, unchanged from April. Agreed sales also remained unchanged, with a net balance of -37%. The reading for house prices stayed at -35% for the second consecutive month. Respondents in the South East and East Anglia reported particularly weak pricing conditions, while Northern Ireland continued to see firm house price growth.
Short-term sentiment in the sales market remained cautious, but near-term sales expectations improved slightly to -25%, compared with -32% and -34% in the previous two surveys. Over a 12-month period, sales expectations edged into positive territory, with a net balance of +2% expecting activity to improve. Near-term house price expectations remained negative, with a net balance of -45% anticipating further falls over the next three months. However, respondents were more optimistic over the year ahead, with a net balance of +6% expecting prices to rise.
In the rental market, tenant demand increased, with a net balance of +14% of respondents reporting growth. Landlord instructions remained negative at -28%. As a result, rental expectations strengthened, rising to a net balance of +36%, the highest reading since May 2025.
The survey also found that transactions are taking longer, with the average period from listing to completion reaching 21.5 weeks, the longest since records began in 2017.
These findings highlight ongoing challenges for UK letting agents and inventory clerks, particularly around supply and demand imbalances in the rental sector and extended transaction times in the sales market.
Source: Mortgage Strategy