The latest UK Residential Market Survey from the Royal Institute of Chartered Surveyors (RICS) sees the year start on an optimistic note, with members reporting “significantly more positive” near-term and 12-month sales expectations.
Although the UK housing market remained “soft” at the end of 2025, RICS members report a return of confidence along with positive expectations for sales and prices.
Buyer demand (-24%) and agreed sales (-19%) remained in negative territory in December, but both measures reflect an improvement on the previous month, which RICS says signals a loss of momentum for the downtown that marked the latter half of 2025.
“The standout indicator was a shift in forward-looking sentiment,” RICS said.
“Sales expectations over the next three months rose to +22%, the strongest reading since October 2024. Looking twelve months ahead, optimism strengthened further, with a net balance of +34% of respondents expecting sales volumes to rise – more than double the level seen in November.”
Surveyors attributed the positive sentiment to easing interest rate expectations and the clearing of budget-related uncertainty.
Supply conditions also stabilised, RICS said, with new vendor instructions flattening to a net balance of 0% and bringing an end to several months of decline. However, the report notes that while this suggests the market has stopped deteriorating, low appraisal activity indicates that any meaningful increase in stock will take time to materialise.
House prices continue to edge down nationally, with a net balance of -14%, “but the trend is clearly moderating.”
Regional divergence remains stark: prices are falling more sharply in London (-42%) and the South East (-32%), while Scotland and Northern Ireland continue to record growth.
“Looking ahead, short-term price expectations have improved to near-flat levels, and +35% of respondents now expect prices to rise over the next year – the most upbeat outlook since late 2024,” RICS said.
RICS head of market research and analysis, Tarrant Parsons, added:
“The UK residential market remains in a prolonged soft patch, with December’s survey recording a sixth consecutive month of negative momentum in buyer enquiries. That said, there are tentative signs of a shift in sentiment beneath the surface.
“Near-term sales expectations have strengthened, and the twelve-month outlook has edged into more positive territory. The key test for 2026 will be whether borrowing costs ease on a sustained basis. If so, this could provide the catalyst needed to drive a recovery in buyer demand.”
The RICS Residential Market Survey is a monthly sentiment survey of chartered surveyors who operate in the residential sales and lettings markets.
