The latest RICS UK Residential Market Survey reveals a notable cooling across the UK’s housing market, with buyer demand, sales activity and new instructions all falling further into negative territory.
New buyer enquiries recorded a net balance of -24%, down from -21% in September and the weakest reading since April. Survey respondents strongly attribute the slowdown to mounting uncertainty ahead of the forthcoming autumn budget and potential tax-raising measures.
‘I don’t think I can recall such an anticipated budget with the potential to impact on the entire property market in so many ways’, chartered surveyor Alex Mcneil from Bramleys in Huddersfield commented.
“I suspect however that people will still need somewhere to live and will soon adapt to whatever challenges make the headlines.”
Agreed sales remained subdued with a net balance of -24%, down from -17% in September. Near-term sales expectations remain broadly flat, but survey respondents expect mild improvement over the next year, with a net balance of +7% anticipating increased activity in 2026.
New vendor instructions posted their third consecutive negative reading at -20%, the weakest since 2021. Appraisal activity – a lead indicator for future stock – softened to -37%, implying fewer listings as potential sellers wait for post-budget certainty.
The national price balance stands at -19%, consistent with the modest declines seen in recent months. Downward pressure is particularly pronounced in London, the South East and East Anglia.
Over the next three months, prices are expected to soften slightly (net balance -12%), although 12-month expectations are back in positive territory (+16%), indicating confidence in a medium-term recovery once policy direction stabilises.
Comments from surveyors across all regions reference a ‘holding pattern’ as the market waits for clarity from the government. Many cite fears of increased property related taxation, including possible changes to stamp duty, capital gains and inheritance tax. Higher-end and London properties appear particularly sensitive, with multiple agents reporting stalled activity above £1 million.
‘Buyers and sellers are definitely feeling jittery because of the government’s riduculous need to drip feed potential areas of taxation weeks before the budget actually takes place’, Will Ravenhill from Readings Property Group in Leicester commented.
John Frost from The Frost Partnership in Beaconsfield agreed:
“The release of a budget date effectively killed all sensible activity in the market. For higher priced property this is because buyers are reluctant to commit with the threat of increased costs and changes to inheritance tax.”
The market is likely to remain subdued through the remainder of 2025 until budget measures and their impact are fully understood and seasonal conditions improve, RICS said.
Head of market research and analysis Tarrant Parsons added:
“Ongoing uncertainty surrounding potential measures in the upcoming budget are thought to be compounding the cautious mood among both buyers and sellers, while above target inflation and rising unemployment are also a negative for the market.
“The coming months will be crucial in assessing how the market responds to the budget, which could prove a turning point in either direction. Greater clarity over housing taxation policy may help stabilise sentiment, but if the measures announced add further pressure to activity, they risk deepening the current slowdown.”
The RICS Residential Market Survey is a monthly sentiment survey of chartered surveyors operating in the residential sales and lettings markets. The October survey sample covers 476 branches coming from 245 responses.
