UK house price growth slows to 1.8%
3 weeks ago
Housing market remains weak as landlords leave and buyer demand falls
12:01 AM, 13th August 2026, 1 week ago
17
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The rental market remains constrained by a lack of supply as some landlords choose to leave the sector.
The latest RICS UK Residential Survey for July 2026 points to a subdued housing market, alongside continued shortages in rental stock.
Landlord instructions remained firmly negative at -27%, with survey feedback indicating that some landlords are reducing their portfolios or exiting the rental market altogether.
Tax and regulation still deter investment
According to the data, tenant demand was broadly flat in the three months to July, with a net balance of -1%, down from +12% previously.
However, despite softer demand, expectations for rents remain firmly positive. A net balance of +28% of respondents expect rents to rise over the next three months, compared with +25% previously.
RICS member comments from across the country repeatedly voice concerns that taxation, regulation and affordability are influencing landlord and tenant behaviour.
One member of RICS told the survey: “Demand continues to outstrip supply. Good property lets almost immediately with minimal voids, but new landlord instructions remain hard to secure. Rents are firm and edging upward. Tax and regulation still deter investment, though the ruling out of rent controls removes one uncertainty”.
Tom Bill, head of UK residential research at Knight Frank said the RICS survey reveals a dramatic drop in supply.
He said: “The Renters’ Rights Act appears to be doing the opposite of what was intended by increasing the financial squeeze on tenants. Supply has fallen and asking rents have risen as landlords face greater financial risks under the new legislation, which for now is proving largely counter-productive.
“Future changes to the minimum energy performance of rental properties may aggravate the situation unless implemented with care.”
Housing market remains subdued
In the sales market, the summer slowdown continued in July, with new buyer enquiries recording a net balance of -28%, unchanged from June. While still firmly negative, this represents an improvement from the recent low of -41% recorded in March, suggesting that the pace of deterioration in demand has eased.
Meanwhile, agreed sales registered a net balance of -30%, also unchanged from the previous month and somewhat less negative than the -37% recorded in April.
The national house price balance came in at -30%, a marginal improvement from -32% in June and the recent low of -35% in April.
RICS chief economist Simon Rubinsohn explained that while a summer slowdown is not unusual in the property market, a combination of wider economic and political factors is continuing to weigh on sentiment.
He said: “The housing market remains subdued, and while that is not usual over the summer months, it is clear from the RICS seasonally adjusted data, that the combination of geopolitics, the domestic political climate and the cost of mortgage finance are continuing to weigh on sentiment.
“Significantly, the forward-looking metrics also remain downbeat, which is not the sort of climate likely to encourage housebuilders to step on the gas on existing sites or in land-buying, as highlighted in recent trading statements from developers.”
Regional differences remain significant
The data also reveals regional differences remain significant. London, the South East and South West continue to report more negative price balances than the national average, whilst respondents in Northern Ireland continue to report rising prices.
After a sustained period of stronger growth, price momentum in Scotland also appears to be flattening.
Expectations for prices over the coming three months remain weak, with a net balance of -31%. However, respondents are slightly more positive over a twelve-month horizon, with the balance standing at +4%.
London stands out as an area lacking confidence, with year-ahead price expectations deteriorating to -23% in July, from -10% previously.
Industry reaction to RICS survey
Jeremy Leaf, north London estate agent and a former RICS residential chairman, said: “Although thankfully not as quiet as a few months ago, the market is not seeing signs of a ‘Burnham Bounce’ – yet.
“It may be down to the time of year, but fewer listings mean the relatively low number of proceedable buyers have less choice, which is slowly increasing the pace of decision making.
“However, the market remains price sensitive so generating buyer traction remains challenging, particularly while uncertainty about possible mortgage rate increases continues.”
Gareth Lewis, deputy CEO of specialist lender MT Finance, said “The market is still stagnant with little movement and low transaction volumes. With a lack of competitive tension in many transactions, property prices aren’t shifting much either way. If you get the right property in the right location then this is not the case, but few meet this criteria.
“The market still badly needs some stimulus and requires more people to transact. Interest rates were expected to fall this year but that outlook has changed with the Bank of England holding base rate for several months. It is not an easy market.”
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Member Since July 2013 - Comments: 506 - Articles: 1
6:08 AM, 14th August 2026, About 1 week ago
Reply to the comment left by Crouchender at 13/08/2026 – 14:34
Or claiming it is “Rent Stabilisation” … they use silly words like this.
Member Since May 2018 - Comments: 2436
10:14 AM, 14th August 2026, About 1 week ago
Reply to the comment left by David Lawrenson at 14/08/2026 – 06:08Yes…the phrase “Rent Stabilisation” is completely bizarre until you recognise it for what it is and understand that it is just a left-wing-lie. “Rent Stabilisation” is another phrase for “Rent Control”. Wherever Rent Controls have been introduced anywhere in the world they have driven rents up: And if you are a left-wing government, you KNOW that; but you still want Rent Controls for ideological reasons and so you have to tell a lie and call them “Rent Stabilisation”.
The Labour Renters Rights Act is nothing like the rental reform bill that was being discussed and proposed by other parties. When you analyse it and look carefully at the detail of it you’ll realise the rent controls are in there and that there are hidden but very significant attacks on property rights; the Labour Renters Rights Act is the shape it is because it received it’s final polishing and tuning under an extreme, majority left-wing government. This is why the left-wingers who were behind the Act are welcoming it. Angela Rayner for example, who lost her job for good reasons but then was brought back by Andy Burnham within just a couple of weeks of him taking over and who simultaneously told us all us all that we’d all been on the wrong track for the last 40 years.
Presumably having Angela Rayner on the left-wing team is helping Andy get us, ‘back on track’. Track to where? I can’t see anything that would stimulate economic growth and I also cannot hear him talking about economic growth much. I think that might be a track to enormous and unsustainable levels of debt because this is the price for not getting strong economic growth.
Sadik Khan, the prominent left-wing mayor of London, has also welcomed the Labour Renters Rights Act:
https://www.property118.com/sadiq-khan-boosts-funding-to-empower-tenants-and-crack-down-on-rogue-landlords/
And Ed Miliband, another well known left-winger has welcomed it citing ending of no-fault evictions, no-bidding wars, easier to have pets [because they have in effect been made a ‘right’ under the Act], and crucially LIMITS ON RENT INCREASES.
https://www.facebook.com/edmiliband/posts/today-the-renters-rights-act-comes-into-force-delivering-the-biggest-upgrade-to-/1513745580108052/
At least you have to acknowledge that Red Ed hasn’t told the lie and has called the Act out for what it is: But what the success of private markets depend upon is competition. Wherever left-wing governments all over the world have imposed rent controls they have driven competition out and driven rents up, and the people behind the Labour Renters Rights Act know that. So yes, they accepted a recommendation for “Rent Stabilisation” even though anybody honest and competent knows that rent controls drive rents up; and this extreme left-wing government didn’t ask for an opinion from the Competition and Markets Authority on what the introduction of their rent controls would do: Asking the Competition and Markets Authority for an opinion on their Labour Renters Rights Bill would have called their lie out and potentially stopped them from introducing their extreme left-wing, Labour Renters Rights Act.
“Rent Stabilisation” is a left-wing lie, it is just another phrase for “Rent Control” although you can see from the Facebook link above that Ed Miliband, Mr. socialist-social-media, has called it what it is on Facebook: The Labour Renters Rights Act is extreme left-wing legislation and it will drive rents up, just as rent controls do in every private market anywhere in the world.
So what’s next? Some people like to call a proposed Private Rented Sector database the PRS database. But if this PRS database project goes ahead then just as the Labour Renters Rights Act is nothing like the rental reform bills being discussed by parliament previously, this database will not be a PRS database; it would only be a PRS database if it had tenant details in there as well, so that good landlords can differentiate the good tenants from the bad ones. The proposed PRS database is NOT designed to have tenant details, it is designed only to have LANDLORD details.
And so this is not a “PRS” database and it needs to be called something else: You can call it a King Herod database if you want as whilst this is a joke it more accurately reflects what the Labour Landlord Database will be if it actually goes ahead. But just as the Labour Renters Rights Act is extreme left-wing legislation that will drive rents up, any Labour Landlord Database will also be an attack on landlords and will ALSO drive competition out of the market and drive rents up.
“Rent Stabilisation” is a Labour lie.
Member Since February 2017 - Comments: 51
11:03 AM, 15th August 2026, About 1 week ago
Landlords have effectively stopped buying in expensive areas, London and the South due to high SDLT and interest rates, regulation etc.
Many are now investing in the Midlands, cheaper areas, and the North, with resulting increase in prices there.
Successive governments have tried to reduce PRS sales and have now succeeded in expensive areas.
Hardly anyone in the South is buying, except a few homeowners and many are delaying, and waiting for interest rates to drop.
We then have the problem of the overpriced and now oversupplied flats.
Part rent part buy is a rip off. High service charges and having to pay for each revaluation, has left people unable to sell. Some will get caught out on it, for the home ownership dream. Landlords wouldn’t touch these properties with a barge pole. Developers can afford to hang on with all the money swimming around, but may be more reluctant to break new ground with the same model.
The Conservatives made incentives for many years, to boost property sales eg SDLT cuts up till following April. People bought and sold because there was a deadline. If Labour wants to get the housing market moving again, especially in high priced areas, they’ll have to do something similar or the revenue for the Govt will drop and future construction projects put at risk.
Personally I’d like to see more houses built. Even terraced ones. People in some of these high blocks and new builds are suffering terribly in the heat and buying air con and fans – hardly what was intended. Whereas many older style houses using traditional brick are cooler.
Burnham (today or yesterday) ruled out SDLT changes for the upcoming budget, so at least that’s something.
Member Since January 2023 - Comments: 13
10:34 AM, 16th August 2026, About 6 days ago
Reply to the comment left by Beaver at 13/08/2026 – 16:25
Bravo. you have hit the nail on the head YOU CANNOT TAX YOUR WAY TO ECONOMIC GROWTH. Lets have this fact published everywhere.
Member Since July 2013 - Comments: 506 - Articles: 1
11:51 AM, 16th August 2026, About 6 days ago
Reply to the comment left by Beaver at 14/08/2026 – 10:14
Rent Stabilisation…. very soviet, …..come up with a name that has no relation to what the law they have made up actually does….
See also the ubiquitous “Ministry of Truth” in most communist and fascist states.
Member Since May 2018 - Comments: 2436
3:47 PM, 16th August 2026, About 6 days ago
Reply to the comment left by David Lawrenson at 16/08/2026 – 11:51
I have to be fair here to Red Ed, Mr. Socialist-social-media, and say once again that despite 1984 and Truth Speak Ed Miliband has told the truth on Facebook: The Labour Renters Rights Act contains RENT CONTROLS.
And anybody who knows anything about rental markets everywhere knows that RENT CONTROLS DRIVE RENTS UP.
The truth is that it is government that is driving rents up.
Member Since July 2013 - Comments: 506 - Articles: 1
8:18 PM, 16th August 2026, About 6 days ago
Reply to the comment left by Beaver at 16/08/2026 – 15:47
Clownworld.
George Osborne the “Tory Clown”… and some other Tories followed, including Clown T May.
Now we have the Labour Clowns in control.
God help us.
Yes, rents going up at a lick. But then the Fabian intellectuals in Labour despise the real working class, considering them oafs and oiks, so why should they care about rents going through the roof.