Tenant demand strengthened while the supply of rental properties continued to fall in August 2026, adding further upward pressure to rents, according to the latest RICS UK Residential Market Survey.

A net balance of +18% of survey respondents reported an increase in tenant demand, while landlord instructions remained negative at -14%.

Expectations for rental growth also strengthened, with a net balance of +44% expecting rents to increase over the next three months, up from +33% in July. Over the following 12 months, respondents expect rents to rise by around 3% on average.

Tarrant Parsons, RICS Head of Market Research and Analysis, said: “August's results show a market that is gradually finding its footing, with key activity indicators having become progressively less negative over recent months.”

The sales market also showed some improvement, although activity remained subdued. The net balance for new buyer enquiries rose to -19%, its least negative reading since January, while agreed sales improved to -17%, the strongest reading since February.

Near-term sales expectations moved from -13% in July to -3%, while the 12-month outlook increased from +3% to +6%.

House prices remained under pressure, with the national price balance improving only marginally from -29% to -28%. London remained weaker than the national average, while Northern Ireland continued to record rising prices and the North West reported modest growth.

New sales instructions were broadly unchanged at zero, while the market appraisals balance of -17% suggested the pipeline of new properties coming to market may remain limited.