UK Residential Market Update: Summer 2025

09 September 2025

At TCL we keep a close eye on the RICS Residential Survey, as it remains one of the clearest barometers of sentiment in the housing market. The August market update point to a sector still under pressure, with demand, sales, and new instructions all softening.

A cooling market

Buyer demand fell for the second month running, with surveyors across the country reporting fewer new enquiries. Sales are following the same path, with activity slowing and most professionals expecting little change in the months ahead. House prices are also under pressure. The overall price balance has slipped further into negative territory, with sharper declines seen in regions such as East Anglia and the South West. By contrast, Northern Ireland continues to buck the trend with modest price growth.

Supply remains constrained

Stock shortages remain a persistent theme. New vendor instructions fell back into negative territory for the first time in over a year, suggesting fewer properties are coming onto the market. This lack of fresh supply is likely to keep conditions tight, even as demand cools.

The rental picture

The rental sector market update tells a different story. Landlord instructions have dropped to their lowest level since 2020, while tenant demand continues to hold firm. The result is upward pressure on rents, which are expected to climb by around 3% over the next year.

Looking ahead

Near-term expectations point to further softening in prices over the next three months, while sales volumes are forecast to remain flat. Over a twelve-month horizon there is still an expectation of modest growth, but sentiment has weakened since earlier in the year. Broader economic uncertainty, inflationary pressures and questions over the path of interest rates are weighing heavily on the market.

TCL insight

For our clients, the message is clear: this is a market that rewards realism. For landlords and investors, understanding the balance between current conditions and longer-term trends is crucial.

For homeowners, accurate, impartial advice on value and condition matters more than ever. With decades of experience in both residential and commercial property, we ensure our clients have the detail they need to make confident decisions, even when the wider picture is uncertain. Call today to discuss your needs on 020 3176 0029