Key facts
- New buyer enquiries in the UK housing market were unchanged at -34% in May.
- Agreed sales also remained steady at -37% in May.
- House prices continued to decline, with a net balance of -35% for the second consecutive month.
- The average time for a property transaction to complete rose to 21.5 weeks.
- Tenant demand in the rental market increased by +14%, while landlord instructions fell by -28%.
The UK housing market showed tentative signs of stabilization in May, with several key indicators holding steady rather than deteriorating further, according to the latest RICS UK Residential Market Survey. New buyer enquiries recorded a net balance of -34%, unchanged from April, marking the first month since January that the demand indicator had not worsened. Agreed sales were similarly unchanged at -37%, suggesting the pace of decline is no longer intensifying, though transactions are taking longer to complete, with the average time from listing to completion rising to 21.5 weeks.
House prices continued to fall at the headline level, with the net balance holding at -35% for the second consecutive month. This downward pressure was most pronounced in the South East and East Anglia, while Northern Ireland continued to record price growth. Short-term sentiment remained cautious, with near-term sales expectations improving slightly to -25% and 12-month sales expectations moving into neutral territory at +2%.
Price expectations remain weak in the near term at -45%, though 12-month expectations edged into positive territory at +6%. The rental market continued to face strain, with tenant demand rising (+14%) while landlord instructions remained deeply negative (-28%). Rent expectations climbed to +36%, the highest reading since May of the previous year.
Tarrant Parsons, RICS Head of Market Research and Analysis, stated that while the data suggests the downturn may be stabilizing, it is premature to interpret this as a recovery. He noted that the decline in CPI inflation provided some relief, but the Bank of England's signals about potential further inflationary pressures due to higher energy costs mean rate rises cannot be dismissed, keeping market sentiment fragile.