The UK housing market showed further signs of stabilisation in August, with declines in buyer enquiries and agreed sales becoming less pronounced, according to the latest RICS survey reported by Mortgage Strategy. While activity remains subdued, several indicators have improved consistently in recent months, with longer-term sales expectations also moving into positive territory.
- Buyer enquiries recorded a -19% net balance, the least negative reading since January.
- Agreed sales recorded a -17% net balance, the least negative reading since February.
- Three-month sales expectations improved to -3%, compared with -13% in July.
- 12-month sales expectations increased to a positive +6%.
- The house price balance edged up to -28% from -29% in July.
- UK rents are expected to rise by around 3% over the next 12 months.
Original article source: Mortgage Strategy
A net balance of 19% of property professionals reported a decline in new buyer enquiries during August. Although the figure remains negative, it was the least negative reading since January and marked the fifth consecutive month of improvement.
Agreed sales followed a similar pattern. A net balance of 17% of respondents reported falling sales, compared with 38% in April, making August the least negative reading since February. The figures suggest that activity remains subdued, but the pace of decline has continued to ease.
Forward-looking indicators also improved during August. The three-month sales expectations balance rose to -3%, compared with -13% in July, bringing the measure close to neutral. Looking further ahead, a positive net balance of 6% of property professionals expect sales volumes to increase over the next 12 months, up from 3% previously.
RICS Head of Market Research and Analysis Tarrant Parsons described the results as showing a market that is “gradually finding its footing,” although he cautioned that any recovery remains fragile. Uncertainty around borrowing costs and the October Budget continues to influence the short-term outlook.
House prices remained under pressure, with a net balance of 28% of respondents reporting falling prices in August. This was only a slight improvement from 29% in July, although it was stronger than the 35% balance recorded in April. London remained softer than the UK average despite improving from July, while surveyors in Northern Ireland continued to report rising prices and the North West maintained moderate price growth.
For buyers, softer pricing in some areas may provide greater scope for negotiation, although conditions continue to vary considerably by region and property type. For investors assessing opportunities in London and across the UK, this makes individual property fundamentals, location and pricing particularly important.
The rental market continued to show a different dynamic, with strong tenant demand and constrained supply maintaining upward pressure on rents. A net balance of 44% of property professionals expected rents to increase over the next three months, up from 33% in July, while respondents expect UK rents to rise by approximately 3% over the next 12 months.
Overall, the August survey does not point to a return to strong market growth, but it does provide further evidence that conditions are becoming less negative. Buyer enquiries have improved for five consecutive months, agreed sales are recovering from their spring lows and 12-month sales expectations have moved into positive territory.
For buyers and investors, the market remains highly dependent on location, pricing and individual property fundamentals. However, the gradual improvement across several activity indicators suggests the UK housing market is moving towards a more stable position.
