The UK housing market is cooling, with buyer demand, sales activity, and new listings all falling further into negative territory, according to the latest RICS UK Residential Market Survey for October 2025. Survey respondents largely blamed uncertainty ahead of the forthcoming Autumn Budget and potential tax rises.
New buyer enquiries recorded a net balance of -24%, the weakest since April, while agreed sales slipped to -24% from -17% in September. New vendor instructions fell to -20%, marking the third consecutive negative reading and the weakest since 2021. Appraisal activity, a key lead indicator for future stock, dropped to -37%, signalling fewer properties coming to market.
National house prices remain under modest downward pressure (-19%), particularly in London, the South East, and East Anglia. Short-term expectations point to slight further declines (-12%), though surveyors remain cautiously optimistic for a medium-term recovery, with 12-month price expectations back in positive territory (+16%).
On the rental side, tenant demand flattened (-4%), while landlord instructions fell sharply (-33%), the weakest since April 2020. Near-term rent growth is projected to be modest (+15%), with concerns over the Renters’ Rights Act and potential tax changes weighing on landlord confidence.
The report indicates that the market is likely to remain subdued through the remainder of 2025, with any meaningful recovery deferred until early 2026, once the impact of the Budget is fully understood and seasonal conditions improve.
RICS head of market research and analysis, Tarrant Parsons, said: “The housing market continued to show weakness in October, with activity levels drifting lower amid a lack of buyer confidence. Ongoing uncertainty surrounding potential measures in the upcoming Budget are thought to be compounding the cautious mood among both buyers and sellers, while above target inflation and rising unemployment are also a negative for the market.
“The coming months will be crucial in assessing how the market responds to the Budget, which could prove a turning point in either direction. Greater clarity over housing taxation policy may help stabilise sentiment, but if the measures announced add further pressure to activity, they risk deepening the current slowdown.”
Reflecting on the latest data from RICS, Tom Bill, head of UK residential research at Knight Frank commented: “By the time the Budget arrives, the housing market will have endured three months of intense speculation around property taxes. Unless there is a pressing need to move, some buyers and sellers have understandably hit the pause button,. While there will be clarity after 26 November, the wide range of tax rises on the table are likely to dent sentiment and put downwards pressure on house prices.”
Estate agents brace for slowdown as buyers await Budget clarity
