RICS Residential Market Survey February 2023
Buyer enquiries rebound but remain in negative territory
- The RICS UK Residential Survey for February results point to continued weakness in market conditions, albeit with the prospect of greater stability as the year progresses.
- Buyer enquiries rebounded to a net balance of -29% up from a reading of -45% in January, but remained negative for the tenth consecutive month, albeit being the least negative reading since July 2022.
- In terms of agreed sales, a net balance reading of -26% was posted in February, up from -36% in January. However, the time taken to complete a sale has edged up to 19 weeks.
Inventory levels remain low
- With respect to new instructions, the latest net balance improved to -4%, up from -12% in January and -22% in December.
- According to a net balance of -33% or respondents, the number of market appraisals undertaken over the month was lower than the equivalent period a year ago, up from a reading of -42% in January, but still firmly in negative territory.
- Indeed, the latest inventory level estimate stands at 34.8 properties per surveyor, broadly unchanged from an estimate of 34 in January.
Buyer enquiries in negative territory for the tenth successive month
![](https://www.retaileconomics.co.uk/uploads/image/RICS Feb 23.jpg)
Source: RICS
Note: Net balance = Proportion of respondents reporting a rise minus those reporting a fall (e.g. if 30% reported a rise in prices and 5% reported a fall, the net balance will be 25%).
Price growth continues to slow
- Prices are softening further as the national net balance for house prices fell marginally to -48% in February, down from -46% in January.
- House prices in Scotland and Northern Ireland continue to show more resilience than those in England and Wales.
Outlook
- Near-term sales expectations remained pessimistic at -47% in February.
- Over the year ahead, a net balance of -8% of respondents foresee sales slipping, compared to a much weaker reading of -20% in January and a low of -45% in August 2022.
- Price expectations for the next three months have risen marginally to a net balance of -55% after a reading of -63% in January.
- Price expectations for the next twelve months remain negative but are somewhat less pessimistic with a net balance of -27%, up from -40% in January.
Rental market
- Tenant demand continues to rise according to a net balance of +32% of contributors.
- On the supply front, a net share of -13% of respondents noted a decline in new landlord instructions.
- As a result, a net balance of +45% of respondents foresee rental prices increasing.
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