The latest UK Residential Market Survey found a decline in buyer enquiries and agreed sales during the month, while surveyors also reported renewed downward pressure on house prices.
Its measure of new buyer enquiries fell from a net balance of minus 18% in August to minus 22% in September, marking the first monthly decline since March. Despite the drop, demand remains stronger than the minus 41% reading recorded six months ago.
Transaction levels also continued to contract, with the net balance for agreed sales edging down from minus 16% to minus 18%, although this remained above the three-month average of minus 25%.
Rachel Springall, finance expert at Moneyfacts, said: “The punishing rise in fixed mortgage rates has meant a typical mortgage repayment is almost £2,000 more per year, compared to the start of 2026.”
Louise Apollonio, sales and distribution director for retail mortgages at Shawbrook, commented: “Buyers don’t need to predict the next rate move; they need to know what they can afford. The latest figures show uncertainty around borrowing costs is weighing on demand, and it’s understandable that people are thinking carefully before committing”.
Industry, not regulation, must lead later life lending change
Sponsored by Suffolk Building Society Intermediaries
Supply shows tentative improvement
Surveyors reported some improvement in the flow of properties coming to market.
The net balance for new sales instructions increased to 6%, the first positive reading since mid-2025. However, respondents noted that appraisal activity has yet to recover to levels seen a year ago, suggesting supply-side improvements remain tentative.
House prices also came under greater pressure during September. The headline price balance declined to minus 32% from minus 8% a month earlier, reversing a recent trend that had seen sentiment steadily improve over the previous four months.
Performance continued to vary significantly across the UK. Much of England recorded weaker price trends during the month, with London remaining one of the softer-performing areas.
Meanwhile, Northern Ireland continued to see price growth, while Scotland posted modest gains.
Looking forward, surveyors expect pricing pressures to persist in the short term. The three-month house price expectation balance stood at minus 24%, although the 12-month outlook was more balanced, with respondents broadly anticipating flat house prices over the coming year.
Tarrant Parsons, head of market research and analysis at the RICS, said higher rate expectations had made some buyers more cautious, resulting in a loss of momentum in sales activity.
He said: “A renewed rise in interest rate expectations has created a fresh headwind for the housing market, with buyers becoming a little more cautious and sales activity losing some momentum this month. Even so, the latest results do not point to any significant shift in direction. Rather, they suggest the market may need to contend with a somewhat longer period of subdued activity as households adjust to the prospect of borrowing costs remaining higher than previously anticipated.”
