The property sales market will remain subdued into the New Year but will pick up over the next 12 months, it has been claimed within RICS’ latest residential market survey covering November whichg includes the period before and after the Budget.

Buyer demand and sales volumes remaining “firmly in negative territory” says RICS and “forward-looking indicators are also yet to suggest any meaningful near-term improvement in the property market”.

Slowdown

Last month, RICS warned of a “deepening slowdown” with a “notable cooling” and a national “pullback”.

In this survey, respondents highlighted the impact of pre-Budget uncertainty and ‘leaks’ on the market.

But there was relief that the ‘High Value Council Tax Surcharge’ or ‘Mansion Tax’ was limited to properties above £2 million.

Agreed sales, buyer enquiries, and new instructions all fell, with London house prices hardest hit by Budget tax measures, according to RICS.

Key findings

• New buyer enquiries recorded a net balance of -32% down from -24% in October, 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 headline net balance for new instructions was -19%, similar to the previous reading of -20%.
• Near-term sales expectations posted a net balance of -6%, slightly weaker than the previous -3%.
• The number of market appraisals being undertaken is running below levels seen 12 months ago, with the net balance slipping to -40% (falling further into negative territory for the fourth consecutive month).
• 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.
• In the lettings market, the net balance for landlord instructions remains deeply negative at -39%, with respondents pointing to a new income tax on property announced in the Budget.

Struggling

Simon Rubinsohn, Chief Economist at RICS (main picture), says: “The housing market has been struggling for momentum for several months, and the recent Budget announcements are unlikely to materially shift that picture.

“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,” he says.

“That said, the twelve-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”.

Industry reaction

Tom Bill, Head of UK Residential Research at Knight Frank, says: “The barrage of property tax speculation before the Budget unsurprisingly soured sentiment among buyers and sellers.

“Now there is clarity, we expect existing transactions to accelerate before Christmas, and activity should remain relatively strong in early 2026.”

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