UK house prices continued to fall at end of 2022, say surveyors

All regions across England are recording lower prices, says Royal Institution of Chartered Surveyors

Letting and estate agents signs outside flats on the Old Kent Road in London. Issue date: Thursday January 19, 2023. PA
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British house prices continued to fall towards the end of 2022, UK surveyors say.

The Royal Institution of Chartered Surveyors found 42 per cent of professionals across the UK reported a decline in prices, its December 2022 survey.

In a further indication of a weakening market, 26 per cent of surveyors reported price falls in the November survey, and indicate the downward price trend gaining further traction, the institute said.

All regions across England are recording prices softening to some degree, with feedback pointing to East Anglia and the south-east having the sharpest rates of decline, the findings show.

But within the negative UK-wide figure, house price readings across Scotland and Northern Ireland are still marginally in positive territory, albeit a significant turnaround from the strong growth reported six months ago, the institute said.

The latest survey also indicates a weakening to the sales market towards the end of 2022, with a net balance of professionals reporting falls in new buyer inquiries.

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The number of new property listings on the sales market also fell and there was an overall decline in agreed sales.

This downwards sales trend became clearer across virtually all parts of the UK over the month, with survey participants in the north-west of England, Scotland, Wales and London all reporting a particularly quiet month for activity in the latest results, the institute said.

The December survey also asked if property professionals were seeing more interest from buyers in homes that are more energy-efficient.

About 40 per cent of those surveyed said yes, but this was outweighed by 60 per cent who did not see this trend, the institute said.

However, 61 per cent of survey contributors said highly energy-efficient homes were holding their value.

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Tenant demand for leased properties increased over December, according to a net balance of 28 per cent of contributors.

But this was the lowest reading since February 2021, and suggests that the pace of demand growth is slowing across the rental market.

On the supply side, new landlord instructions remain on a downward trend, with a net balance of 24 per cent of professionals seeing a decline in December.

Near-term expectations continue to point to rents being squeezed higher, the institute said.

“The latest Rics residential survey highlights the emerging challenges in the housing market as new buyers grapple with more costly finance terms and uncertainty over the outlook for the economy," said Simon Rubinsohn, the institute's chief economist.

“Meanwhile, feedback around the lettings market once again demonstrates the need for some concerted thinking about how to create a thriving sector that caters for both the private and ‘affordable’ renter.”

Mairead Carroll, the senior specialist in land and property standards at the institute, said: “It will be fascinating to see how important energy efficiency becomes to buyers over the next 12 months."

The residential market report is a monthly sentiment survey of chartered surveyors in the UK’s residential sales and lettings markets.

Updated: January 19, 2023, 12:02 AM
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