New data from the Royal Institution of Chartered Surveyors (RICS) suggests that the UK housing market is beginning to show early signs of positivity, offering optimism for buyers, sellers and industry professionals alike. The latest January survey reported improvements across key market indicators, the least negative readings in months, pointing to a slow but positive shift in sentiment.
📈 House Price Balance Improves
The RICS house price balance rose to -10% in January, up from -13% in December, marking the strongest reading since June 2025. This third straight monthly improvement signals that downward pressure on prices is moderating across much of the UK.
📊 Buyer Enquiries and Sales Stabilise
Other key measures also showed improvement. New buyer enquiries climbed to -15%, the best level since mid-2025, while agreed sales rose to -9%, the least negative result in around six months — indicating that activity is strengthening.
📍 Growing Confidence for 2026
Forward-looking sentiment among survey respondents also improved, with more estate agents and surveyors expecting increased sales and price growth over the next 12 months. This growing confidence reflects a tentative belief that market conditions could turn more positive as the year progresses.
🏡 Mortgage Affordability Improving
Market dynamics are also being influenced by shifts in mortgage affordability, a key factor for many homebuyers. Recent analysis from Moneyfacts shows that average mortgage payments, which peaked at almost half of gross monthly income in 2024, could fall back toward levels last seen in 2021 if typical interest rates settle around 4.25–4.50% later this year. This would represent a notable improvement in affordability, helping more households qualify for finance and boosting buyer confidence.
While mortgage rates have fluctuated recently, with lenders adjusting deals in response to Bank of England decisions, the broader trend toward lower borrowing costs compared with recent peaks is beginning to ease some of the cost pressures that squeezed buyers in prior years.
📍 Regional Momentum
Despite ongoing variation across regions, areas such as Northern Ireland and Scotland have reported stronger pricing trends, while more subdued areas in the South are also showing signs of slowing declines. This suggests that pent-up demand may be re-emerging in pockets of the market.
📌 Industry Outlook
RICS Chief Economist Simon Rubinsohn emphasised that while improvement is gradual, the combination of stabilising price expectations and easing affordability pressures are encouraging early signals for the wider market. That said, continued monitoring will be essential to confirm a sustained improvement over the coming months.
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