RICS Residential Market Survey December 2025

Sales market remains subdued, but forward-looking sentiment improves

New buyer enquiries remained in negative territory at -24% in December (from -30% previously), marking a sixth consecutive month of declining demand, though the pace of deterioration has eased.
Agreed sales were little changed at -19% (vs -22% previously), continuing to show weak transaction volumes but with signs that activity is stabilising.
Near-term sales expectations strengthened sharply to +22%, the most upbeat reading since October 2024, pointing to growing optimism for early 2026.
Twelve-month sales expectations also improved materially to +34% (from +15%), suggesting respondents are increasingly confident that activity will recover over the year ahead.
Improved sentiment reflects expectations of further interest rate cuts and the removal of recent Budget-related uncertainty.

Supply conditions stabilise, but pipeline remains fragile

New vendor instructions improved to 0% in December (from -17% previously), indicating a broadly stable flow of new listings after several months of decline.
However, market appraisals remained deeply negative at -30%, due to appraisal activity still being well below levels seen a year ago and that a meaningful uplift in future supply is unlikely in the near term.

House prices continue to edge lower, with stabilisation signals emerging

The national house price balance held at -14%, consistent with a modest ongoing decline but suggesting downward momentum is beginning to ease.
Regional divergence remains pronounced, with London (-42%) and the South East (-32%) continuing to underperform the national average.
Scotland and Northern Ireland remain notable exceptions, with respondents continuing to report modest price growth.
Short-term price expectations improved to -6%, pointing to a broadly flat outlook over the next three months.
Over the next 12 months, sentiment turned decisively positive, with +35% of respondents expecting prices to rise, the strongest reading since late 2024 and supportive of a gradual recovery into 2026.

Rental market loses momentum as demand weakens and supply pressures persist

Tenant demand slipped further into negative territory at -27% (from -22%), the weakest reading since the early stages of the pandemic, reflecting a clear loss of momentum.
New landlord instructions remained deeply negative at -39%, due to ongoing supply withdrawals from the private rented sector.
Despite softer demand, near-term rent expectations strengthened to +19%, suggesting supply constraints are still expected to put upward pressure on rents.
Over a 12-month period, rents are projected to rise by around 3%, implying a more moderate but still inflationary rental outlook.