While buyer demand and sales activity remain in negative territory, sentiment around the near-term outlook is showing tentative signs of improvement.  This is according to the latest RICS, UK Residential Market Survey for May.

A net balance of -26% of survey participants reported a fall in new buyer enquiries in May. This marks the fifth consecutive month of decline, but the figure is slightly more positive than seen in March and April. Agreed sales also continued to edge lower, returning a net balance of -28%.

However, the Rics survey shows the sales outlook over the next three months improving slightly, with expectations now broadly flat rather than falling.

Looking further ahead, 25% of respondents anticipate an increase in sales volumes over the next year, the strongest reading since February.

The picture for house prices remains largely unchanged. The national net balance slipped to -8% in May, from -3% the previous month, but continues to suggest a relatively flat market overall.

Price expectations for the next twelve months remain in positive territory, with a net balance of 34% of respondents expecting prices to rise.

On the supply side, new instructions coming to market continue to edge up. A net balance of +7% of surveyors saw a rise in new listings, marking the eleventh consecutive month of growth. Valuation activity also picked up, with +19% noting an increase in appraisals compared to a year ago, indicating a potentially more active summer market.

In the lettings sector, tenant demand strengthened once again in May, returning a net balance of +22%, the highest since September 2024. At the same time, landlord instructions continue to dwindle, with -34% reporting a drop.

As a result, rents are expected to rise further in the near term, with the net balance for rental growth expectations jumping to +43%.

Commenting on the latest figures Rics senior economist, Tarrant Parsons, said:

“Sentiment across the UK residential property market remains somewhat subdued, with ongoing uncertainty around global trade policies and the dampening effect of transactions being brought forward ahead of the Stamp Duty changes at the end of March continuing to weigh on buyer activity.”

However, he added: “Near-term sales expectations are showing signs of stabilisation, suggesting that while muted conditions may persist in the short term, a further deterioration appears unlikely. Looking ahead, the outlook is more optimistic, with respondents anticipating a gradual recovery in sales activity over the next twelve months.

“That said, the pace and extent of any improvement will partly depend on the Bank of England’s ability to continue cutting interest rates.”