According to the latest report from Savills, in the next five years we will see Brexit-related issues subside and the UK housing market increase in value. The company’s latest residential forecast predicts major growth across the UK, with the North of England leading the way.
The headline statistic is that Savills expects house prices to rise on average by 15.3% over the next five years, taking the average house price in the UK to £266,000 by 2024.
However, by digging deeper into the regional data it is clear that some areas of the country are going to do a lot better than that, while others will see slower growth.
London will be the big loser over the next five years, with the analysis estimating growth of only 4% over that time period. This is the latest in a long line of blows for the capital’s housing market, and we are likely to see an increasing number of homebuyers and investors leaving the city to look for better prospects elsewhere.
In contrast, the biggest winners can be found in the North. The North East can expect to see growth of 19.9% and Yorkshire and Humberside growth of 21.6%, however the largest growth will be found in the North West where house values are predicted to grow by a huge 24%. This would see the average property price in the region increase from £169,000 to £210,000 by 2024.
Head of residential research for Savills, Lucian Cook, said: “We anticipate a continuation of trends seen historically, where London and the south-east underperform markets in the midlands and north.
“This stage of the cycle appears to have begun in 2016, coinciding with the referendum, when London hit up against the limits of affordability.”
When looking at why such impressive house price growth was expected in the North West, Savills highlighted the strength of Manchester as a particularly important factor.
Charlie Kannreuther, head of residential at Savills in the North West and West Midlands, said of the figures: “The economic pull of Manchester continues to be a major factor in the strength of the North West property market, and we’ve seen a notable increase in interest from buyers outside the area, particularly from London and the South East.
The past few years have seen more and more people moving to northern cities like Manchester to make the most of the outstanding job opportunities on offer and the relatively low house prices. It is clear from the Savills data that this trend is likely to not only continue, but become even more pronounced over the next five-year cycle.
For homebuyers and investors, this means that there is significant capital appreciation on offer if you buy now – particularly if you purchase off-plan and lock in today’s price ahead of the rises in the pipeline.
For more information about our off-plan opportunities and the capital you could earn from the upcoming property price boom predicted by Savills, click here and enquire today..