August 2018: UK Residential Market Survey

Prices continue to rise in much of the UK

  • Robust price growth reported across Scotland and Northern Ireland
  • New instructions edge further into negative territory
  • Sales expectations suggest activity is likely to remain stronger away from S England


Amidst reports of house prices (nationally) posting the first annual decline since July 2012, it is noteworthy that the August 2018 RICS Residential Market survey continues to show stronger trends in large parts of the UK. Significantly, whilst sentiment remains downbeat in London, parts of the wider South East, and to some extent East Anglia, the results remain more solid in other areas, with Northern Ireland and Scotland in particular standing out.

Weakness in London and the South East continues to provide an offsetting impact. Overall, this is broadly consistent with no change in prices over the period as far as the national market is concerned.

Newly Agreed Sales:  the most negative reading on this metric for five months. As such, this result is pointing towards a modest decline in sales transactions. Disaggregating the data shows that, after a sharp fall in activity near the end of last year, sales trends are at least stabilising in the capital, although there remains little in the way of positive impetus. Results also point to subdued momentum across East Anglia and the South East however sales trends are solid in the South West. Near term sales expectations suggest this regional divergence will persist, with the market remaining relatively stronger away from the South of England.

The survey has previously highlighted a lack of supply in the housing market as one of the main impediments to activity. The average inventory of unsold stock inched back towards the historic lows of earlier in the year.

With regards to demand, the New Buyer Enquiries report is still consistent with a more or less flat trend in buyer demand. The latest figure has not deviated much from the last two readings although it does portray a slightly more cautious approach from property purchasers. This is not entirely surprising in the wake of the Bank of England’s decision to increase interest rates in August alongside the broader political and economic uncertainty influencing the sales market.