RICS March 2026 Survey: Buyer Enquiries Near Three-Year Low as Iran War Reshapes Housing Market

The RICS UK Residential Market Survey for March 2026 delivered the starkest reading of buyer sentiment since August 2023, as the full weight of the Iran conflict’s economic fallout registered across the property market. Released in early April, the data captured a market under acute pressure from rising borrowing costs, weakening confidence, and a geopolitical backdrop that had transformed the outlook from cautiously hopeful to deeply uncertain in the space of five weeks.

New buyer enquiries — the survey’s primary measure of demand — fell to a net balance of -39% in March, sharply down from -29% in February, which was itself already weaker than January’s -15%. The deterioration across three consecutive months traced the arc of the Iran conflict almost precisely: the worse the geopolitical situation became, the faster buyer sentiment retreated. Agreed sales fell to a net balance of -34% from -13% the previous month. Short-term sales expectations collapsed to -33%, compared with -4% in February.

The Worst Demand Reading Since August 2023

The March buyer enquiries balance of -39% was the weakest since August 2023 — the peak of the UK’s post-pandemic inflation and rate shock. That comparison is significant. August 2023 came after the Bank of England had raised rates to 5.25%, the highest level in 15 years, in a sustained battle against inflation that peaked above 11%. The fact that the March 2026 reading was approaching that level — achieved when rates were still at 3.75% and considerably lower than the 2023 peak — spoke to the degree of psychological disruption the Iran war had caused, beyond the purely mechanical impact on mortgage pricing.

Buyers were not just recalculating affordability. They were reassessing the entire basis of their financial plans in an environment of unprecedented uncertainty. With oil prices surging, inflation expectations rising, government borrowing costs climbing, and the Bank of England’s rate path suddenly unknowable, the rational response for many potential buyers was to pause.

Expert Commentary: Rates, Sentiment and the Path Ahead

Simon Rubinsohn, RICS Chief Economist, said average fixed rates had climbed back above 5% according to several sources, making it “unsurprising” that buyer demand had softened significantly. He noted that the path ahead hinged entirely on whether the surge in oil and energy costs would begin to reverse — and that the geopolitical environment remained “highly uncertain.”

Tom Bill, head of UK residential research at Knight Frank, offered a more contextualised view. He argued that sentiment would improve if the two-week ceasefire announced on 7 April 2026 held, which would support transaction levels as the spring market developed. However, he cautioned that mortgage rates would not return to their pre-war levels even in a ceasefire scenario, because of “the longer-term inflationary impact of the war and the associated vulnerability of the government’s financial position.” Rates might ease, but they would remain elevated relative to what buyers had been expecting at the start of the year.

Supply Rising as Demand Falls: A Potential Double Pressure

The March survey also recorded an increase in new instructions — properties being listed for sale — even as buyer demand fell. This combination of rising supply and falling demand is the classic precondition for price softening. As Kate Faulkner OBE observed in commentary reported by The Negotiator, the UK property market was “facing twin severe headwinds of reduced demand and increased supply” and that much of the market had “not yet adjusted to the new reality that is unfolding.”

The dynamic was particularly visible in London and the South East, where buyer demand had softened most sharply and where listing volumes had increased as sellers sought to exit positions before conditions deteriorated further. In more affordable northern markets, the effect was more muted — reflecting the same regional pattern that Halifax’s price data had shown.

The Rental Market: Demand Stable, Supply Squeezed Further

On the lettings side, the March survey recorded tenant demand as broadly stable but landlord instructions continuing to decline. The rental stock shortage that had characterised the UK private rented sector throughout 2024 and 2025 showed no sign of easing — and the combination of rising mortgage costs, incoming Renters’ Rights Act obligations, and broader economic uncertainty was accelerating the rate at which some landlords were exiting the sector. Fewer landlords listing properties meant tighter supply, which in turn kept upward pressure on rents even as tenant affordability was squeezed.

Reading the RICS Survey Through a Caribbean Lens

The RICS survey methodology — polling chartered surveyors directly about what they are experiencing in the market — provides a ground-level perspective that complements the price data from Halifax and Nationwide. For Jamaican property market observers, the March 2026 reading illustrates several dynamics that translate across markets.

First, the speed of sentiment shifts. Within five weeks of the Iran conflict beginning, buyer confidence had moved from tentative recovery to near-recessionary levels. Markets can change direction quickly when external shocks are large enough. Anyone operating on the assumption that 2026 would be a straightforward year had to rapidly revise their plans.

Second, the distinction between sentiment and fundamentals. The RICS survey measures mood — and mood can overshoot in both directions. The March reading reflected genuine fear and uncertainty, but the underlying structural supply shortage in both the sales and rental markets had not changed. Prices do not fall indefinitely when supply is structurally constrained. The correction, when it came, was expected to be measured rather than catastrophic.

For Jamaican landlords and developers, the same logic applies. External shocks can suppress demand temporarily, but structural housing shortages — which characterise Kingston and other Jamaican urban centres just as they do much of England — provide a fundamental support for property values over the medium term. Panic selling in response to short-term sentiment moves rarely serves long-term investors well.

Source: Estate Agent Today / RICS UK Residential Market Survey March 2026, 8 April 2026.

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