Buyer enquiries and agreed sales fall to weakest levels since 2023 amid geopolitical uncertainty
The UK housing market lost momentum in March as higher borrowing costs and geopolitical uncertainty weighed on confidence, the Royal Institution of Chartered Surveyors (RICS) said in its latest Residential Market Survey.
New buyer enquiries fell further, to a net balance of -39% in March from -29% in February, the weakest result since August 2023. Agreed sales also deteriorated, slipping to -34% from -13% a month earlier.
RICS said short-term expectations weakened sharply. Respondents reported a net balance of -33% for sales over the next three months, compared with -4% in February, suggesting activity could soften further. Looking 12 months ahead, expectations for sales eased to -1%, pointing to a broadly flat outlook.
Price indicators also turned lower. The headline price balance dropped to -23% in March, from -14% in February and -10% in January, signalling wider downward pressure. Expectations for the next three months fell to -43%, while the 12-month view edged down to +2%.
Source: Royal Institution of Chartered Surveyors
Regional results were mixed. London, East Anglia, the South East and the South West recorded weaker price readings than the national average, while Scotland and Northern Ireland continued to report price rises.
On supply, new instructions remained subdued at -6%. Unsold stock on agents’ books increased to an average of 47 properties, up from about 45 at the start of the year.
Lettings indicators were firmer but continued to show an imbalance. Tenant demand rose to a net balance of +10% in March, while landlord instructions remained negative at -25%. Respondents expected this gap to push rents higher, with near-term rental expectations rising to +29%.
“The mood across the UK housing market has shifted markedly over the past couple of months,” said Tarrant Parsons (pictured right), head of market research and analysis at RICS. “What had been a cautiously improving picture for activity has been knocked off course by the wider macro fallout from the Middle East conflict, as the renewed deterioration in the mortgage rate outlook has proved particularly challenging.
“Indeed, with average fixed rates climbing back to 5%, according to some sources, it is unsurprising that buyer demand has softened. The path ahead hinges on whether or not recent surges in oil and energy costs begin to reverse in what remains a highly uncertain geopolitical environment.”
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