UK house price growth set to cool over the next five years

 
Helen Cahill
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Economic uncertainty will cause a slowdown in the housing market (Source: Getty)

London house prices will grow by 11 per cent by 2021, according to new research, lagging behind the UK as a whole.

Savills is predicting two years of low house price growth due to heightened economic uncertainty as the terms of Brexit become more clear.

UK house price growth is expected to be 13 per cent over the next five years, with the average house price increasing from £214,000 to £241,900.

Read more: This is what happened to house prices in October

In London, growth will fall behind the rest of the country because house prices have already rocketed to high in the years after the financial crash.

But house prices will remain more than double the UK average in 2021. The London average house price is expected to grow from £481,000 to £533,400 in five years.

House prices have been falling in prime central London, largely due to increases in stamp duty tax. Savills has said that prices on these high-end homes won't start to rise again until 2019.

Lucian Cook, UK head of residential research at Savills, said: "There is no precedent for the current market and the Brexit vote makes forecasting more challenging than perhaps ever before.

"The effect of Brexit is complicating a natural shift towards the later stages of the housing market cycle, when the strongest growth is seen beyond London and the South East. What is clear is that the housing market does not like political and economic uncertainty and this points to a lower growth, lower transaction market across the board."

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