UK Housing Market Slows Amid Rising Mortgage Costs and Geopolitical Uncertainty

The Royal Institution of Chartered Surveyors (RICS) released a report on the UK housing market for March, indicating a slowdown in activity. A net 39 percent of surveyed professionals reported a drop in new buyer inquiries, an increase from 29 percent in February. This figure represents the weakest reading since August 2023.

Agreed sales also declined, with 34 percent of professionals reporting a drop, up from 13 percent the previous month. The report attributes the slowdown to rising borrowing costs and geopolitical uncertainty. These factors have reduced buyer confidence and affected longer-term house price expectations.

Looking ahead, 33 percent of professionals expect sales to weaken further over the next three months.

Over the next 12 months, only 1 percent anticipate weakening, suggesting a broadly flat market. In March, a balance of 23 percent of professionals observed falling house prices, with 43 percent expecting falls in the next three months and only 2 percent expecting increases over the next year.

Regionally, London, East Anglia, the South East, and the South West recorded weaker price readings than the national average.

In contrast, Scotland and Northern Ireland reported rising prices. New instructions to sell remained subdued, and unsold stock on estate agents' books increased to an average of 47 properties, up from 45 at the start of the year.

the lettings market, tenant demand rose while landlord instructions decreased, creating a mismatch between supply and demand.

Tarrant Parsons, RICS head of market research and analysis, commented on the shift in market conditions.