The March 2023 RICS UK Residential Survey portrays a persistently weak housing market, with negative indicators for demand, sales, new listings, and house prices. Despite expectations that this trend will continue due to the tighter lending environment, respondents predict a more stable sales trend emerging in the twelve-month view.

New buyer enquiries saw a net balance of -29% of contributors reporting decreased demand in March, virtually unchanged from -30% in February. The decline in buyer demand was widespread throughout the UK, with almost all regions and the four nations showing negative readings.

The national net balance for agreed sales fell to -31% in March, down from -25% in February, with near-term expectations suggesting that sales will continue to face pressure, returning a net balance of -29%. However, this is less pessimistic than the -45% reading in February, and negativity in near-term sales expectations has lessened over the past three reports. The twelve-month sales expectations net balance reached +1%, marking the first time this measure has been out of negative territory since March 2022.

The supply of fresh listings fell slightly in March, with a net balance of -6% compared to -4% previously. The number of appraisals in March also remained lower than the same period last year, with a net balance of -20%. House prices continued to decline, as indicated by a headline net balance of -43% of respondents reporting a drop.

RICS Chief Economist Simon Rubinsohn noted that the overall feedback remains cautious towards the sales market, but the medium-term outlook seems more settled, influenced by the perception that the interest rate cycle may be nearing its peak. The rental market, however, remains constrained by the lack of stock, and the consistent message from contributors highlights the shortage of rental properties and the impact on rent levels.