The RICS UK Residential Market Survey for November reveals a subdued property market following the government’s autumn budget, with metrics on buyer demand and sales volumes remaining firmly in negative territory.
Forward-looking indicators are also yet to suggest any meaningful near-term improvement in the property market, RICS said, with agents predicting a revival in spring next year.
New buyer enquiries recorded a net balance of -32%, down from -24% in October, marking the weakest reading since late 2023. For agreed sales, the latest net balance of -23% is virtually unchanged from last month’s -24%, signalling a clear downward pattern in sales activity.
“The housing market has been struggling for momentum for several months, and the recent budget announcements are unlikely to materially shift that picture,” said RICS chief economist Simon Rubinsohn.
“The ending of budget related uncertainty is welcome, but the fundamental challenges of affordability and elevated borrowing costs will in all probability keep activity subdued in the near term. That said, the 12 month outlook has brightened somewhat, likely reflecting a growing sense that the Bank of England may have a little more scope to reduce interest rates than seemed plausible only a short while ago.”
The near-term sales expectations series posted a net balance of -6%, slightly weaker than the previous -3% but still consistent with a largely flat outlook for sales for the coming three months. Over the year ahead, however, a net balance of +15% of respondents anticipate sales volumes will pick up, a more positive result than the +7% recorded last month.
The headline net balance for new instructions was -19%, similar to the previous reading of -20%, indicating a continued slowdown in the flow of properties being listed for sale.
Respondents are increasingly reporting the number of market are running below levels seen 12 months ago, with the net balance slipping to -40% (falling further into negative territory for the fourth consecutive month). This suggests the pipeline for new instructions is likely to remain subdued in the near term, RICS said.
Survey feedback continues to point to a gentle decline in house prices at the aggregate level, posting a net balance of -16% in November. Net balance in London dropped to -44%, more negative than any other part of the UK, in part due to the introduction of the High Valuation Council Tax Surcharge. In contrast, respondents in both Northern Ireland and Scotland continue to cite an upward trend in house prices.
Near-term price expectations were little changed in November, with a national net balance of -15% registered (-12% previously). The 12 month expectations series moved slightly higher, with a net balance of +24% anticipating house prices will resume an upward trajectory over the coming year (the strongest reading since June).
“The latest RICS UK Residential Market Survey reflects the initial reaction of its members to the budget,” Anthony Codling, managing director, equity research, RBC Capital Markets said.
“In short, they were not amused. To be fair, few of us do our best work in the immediate aftermath of a major event and the build up to the budget was quite draining for those involved in the property market. Those who are feeling fragile may not wish to dig too deeply into the latest RICS report. However, the good news is that there are only 14 sleeps until Christmas and UK households love the smell of Rightmove on Boxing Day morning (we expect record viewing figures), and we believe that RICS’ December survey will be more upbeat than the post-budget November edition.”
The RICS Residential Market Survey is a monthly sentiment survey of chartered surveyors who operate in the residential sales and lettings markets. The November survey sample covers 427 branches coming from 232 responses.
