Editor's note: This brief was summarised by The Property AI Newsroom from a report by Property Industry Eye. Read the original article for full details.
RICS Survey Shows Housing Market Stabilising, Rent Pressures Mount
The UK housing market showed further signs of stabilising in August, but expectations for rent increases have surged, according to the latest RICS UK Residential Market Survey reported by Property Industry Eye.
Buyer demand and agreed sales both improved from recent lows, with the net balance for new buyer enquiries rising to -19%, the least negative reading since January and marking a fifth consecutive monthly improvement. Agreed sales also strengthened, with the net balance increasing to -17%, up from a recent low of -38% in April. Expectations for sales over the next three months moved closer to neutral, with the net balance improving from -13% in July to -3% in August. Looking ahead, 6% of survey respondents expect sales volumes to increase over the next 12 months, compared to 3% previously.
Despite these improvements, house prices continued to face downward pressure. The headline price balance edged up from -29% in July to -28% in August, showing gradual improvement from -35% in April. Survey respondents still expect prices to fall over the next three months, while the 12-month outlook remains broadly flat. Regional differences persist, with London recording a more negative price balance than the national average, though conditions improved from July. Northern Ireland continued to report rising prices, and the North West of England maintained modest price growth.
There was little change in the supply of homes coming onto the sales market, with the new instructions balance at zero compared to -2% in July. Market appraisal activity remained weak, with a balance of -17%, indicating fewer appraisals than a year earlier. This suggests the sales market is unlikely to see a significant increase in new listings in the near term.
Lettings Market: Tenant Demand Rises, Rent Expectations Surge
In contrast, the lettings market continued to see rising tenant demand and constrained landlord supply. The monthly tenant demand balance stood at +18%, while landlord instructions recorded a negative balance of -14%.
As a result, expectations for further rent increases strengthened sharply. The balance of respondents expecting rents to rise over the next three months jumped from +33% in July to +44% in August. Over the next 12 months, respondents expect UK rents to increase by around 3% on average.
These trends are particularly relevant for letting agents and inventory clerks, as ongoing supply constraints and rising demand may impact rental agreements, property management, and inventory processes in the coming months.
Source: Property Industry Eye