The latest RICS Residential Market Survey indicates a continued weakening in UK housing market activity as of November, with buyer demand, new listings, and sales all declining. This trend follows the Autumn Budget, which introduced new property taxes and created uncertainty that has dampened confidence among landlords, tenants, and buyers alike.

For landlords, these developments signal a challenging lettings market with reduced tenant demand and cautious investment sentiment, underscoring the need to adapt strategies in a subdued market environment.

Housing Market Activity Declines Post-Budget

According to RICS, UK housing market activity weakened again in November, as speculation and political noise surrounding the Autumn Budget undermined confidence. Agents reported falling buyer demand, fewer new instructions, and sluggish sales, with many attributing the slowdown to uncertainty generated by Budget leaks and announcements.

The lettings market is also showing signs of strain. Landlord instructions remain negative at -39%, reflecting a reluctance among landlords to enter or expand in the market. The introduction of a new income tax on property, as announced in the Budget, is cited by many respondents as an additional barrier to investment in rental properties.

Tenant Demand and Rent Expectations

Tenant demand has cooled significantly, with a net balance dropping to -22%, the weakest level since April 2020. This decline in demand is notable for landlords, as it may affect occupancy rates and rental income stability.

Despite the fall in tenant demand, near-term rent price expectations remain positive at +6%, suggesting only marginal rent increases in the coming months and a projected 2.5% rise next year. This indicates that while demand is softening, limited stock availability continues to support rental prices to some extent.

Simon Rubinsohn, RICS’ chief economist, commented: “In the lettings market, although tenant demand does appear to be softening the lack of stock is keeping rental expectations elevated and the additional tax levied on landlords in the Budget will likely exacerbate this trend.”

Buyer Enquiries and Sales Outlook

The survey also highlights a sharp drop in new buyer enquiries, with a net balance of -32% in November, a steeper decline than October’s -24% and the weakest reading since the start of 2023. Agreed sales remained low at -23%, consistent with the downward trend observed throughout the autumn months.

The near-term sales outlook has worsened slightly, falling to -6% from -3%. However, agents remain cautiously optimistic about 2026, with a net balance of +15% expecting sales volumes to increase, an improvement on last month’s +7%.

Supply Constraints and Price Trends

New listings continue to fall, with a headline figure of -19%, closely matching October’s -20%. Appraisal levels have also declined, registering a net balance of -40%, marking four consecutive months of deterioration. This suggests a weak supply pipeline as the market enters winter.

Nationally, prices continue to soften with a net balance of -16%, while London has experienced a more pronounced decline, with prices dropping to -44%. This regional disparity is important for landlords to consider when assessing property values and rental potential.

Market Sentiment and Political Impact

Tom Bill, head of UK residential research at Knight Frank, noted: “The barrage of property tax speculation before the Budget unsurprisingly soured sentiment among buyers and sellers. Now there is clarity, we expect existing transactions to accelerate before Christmas, and activity should remain relatively strong in early 2026.”

He added that a downward trend in interest rates could support demand, but political uncertainty remains a key risk. Bill also warned that ongoing political developments, particularly ahead of next spring’s local elections, could continue to influence market confidence.

Implications for Landlords

For UK landlords, the current market conditions suggest a cautious approach is advisable. The combination of reduced tenant demand, new property taxes, and a subdued sales environment means investment decisions should be carefully evaluated. Maintaining competitive rental pricing and monitoring local market trends will be essential to sustaining occupancy and income.

Landlords should also be aware of the potential for marginal rent increases in the near term, balanced against the risks posed by political and economic uncertainty.

Looking Ahead: Trusted Partners Hub Launch

In response to the evolving market landscape, the Landlord Association (TLA) is launching a new Trusted Partners Hub in Q1 2026. This platform will feature verified and approved service providers selected to support landlords, tenants, and property management businesses. Service providers in legal, trades, insurance, financial, mortgage, tenant screening, and related sectors are invited to register their interest here: https://landlordassociation.org.uk/become-a-tla-service-partner/.