RICS survey shows housing market weakens again after Autumn Budget

UK housing activity weakened again in November as speculation around the Autumn Budget sapped confidence and pushed key indicators further into negative territory.

That’s according to the latest RICS Residential Market Survey with agents reporting another month of falling buyer demand, shrinking instructions and sluggish sales.

Many said the political noise ahead of the Budget, including a stream of leaks, kept households on the sidelines.

The lettings market is also slowing as landlord instructions remain negative at -39%, with many respondents pointing to the new income tax on property announced in the Budget as another barrier to investment.

Tenant demand has also cooled noticeably as the net balance dropped to -22%, the weakest level since April 2020.

Near-term rent price expectations stand at +6%, suggesting only marginal rises in the coming months and a 2.5% rise next year.

Tenant demand drops

RICS’ chief economist, Simon Rubinsohn, said: “In the lettings market, although tenant demand does appear to be softening the lack of stock is keeping rental expectations elevated and the additional tax levied on landlords in the Budget will likely exacerbate this trend.

“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 added: “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 than seemed plausible only a short while ago.”

New buyer enquiries

The survey also shows that new buyer enquiries dropped sharply, with a net balance of -32% in November.

That’s a steeper fall than October’s -24% and the weakest reading since 2023.

Agreed sales barely moved, recording -23% after -24% in the previous month, reinforcing a downbeat sales trend that has run through the autumn.

The near-term sales outlook fell to -6%, down from -3%.

However, agents anticipate a better year ahead, with a net balance of +15% expecting volumes to increase in 2026, more upbeat than last month’s +7%.

New listings fall

The headline figure for new listings came in at -19%, broadly matching October’s -20% and appraisal levels have slipped with a net balance of -40%.

That has deteriorated for four consecutive months, hinting at a weak supply pipeline as winter sets in.

Prices continue to soften at a national level, registering a net balance of -16%.

London’s figure fell much further, dropping to -44%.

Buyer sentiment soured

Tom Bill, the head of UK residential research at Knight Frank, said: “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.

“A downwards trajectory for interest rates will support demand but political uncertainty will become the key risk.”

He adds: “The game of ‘guess the tax rise’ played in recent months could become a game of ‘guess the Chancellor’ if next spring’s local elections are as bad for Labour as the polls suggest.”