House prices to surge another £50,000 over next five years
House prices are expected to surge another £50,000 over the next five years, further reducing affordability in the UK property market, according to new forecasts published today.
Estate agent Savills predicts house prices will jump nine per cent this year, driven by the extended stamp duty holiday and prospective buyers rushing to purchase larger homes with gardens.
Read more: Average UK house price 30 per cent up on 2007 market peak
The firm also expects an increase of 3.2 per cent next year, and an accumulative 21.5 per cent by the end of 2025.
Lower interest rates, an increase in the supply of high loan-to-value mortgages as lenders return to riskier sections of the market and high levels of savings built up during the pandemic are expected to keep demand elevated, Savills said.
Over the next five years, the North West and Yorkshire and the Humber are set to register the highest rate of property price growth, up 28 per cent, partly due to prices rising from a relatively lower base compared to the rest of the UK.
Poor housing supply is expected to continue over the next half a decade, while demand will remain high, putting upward pressure on prices.
Lucian Cook, head of residential research at Savills, said:“This imbalance looks set to continue, underpinning further price growth over the near term, particularly as people look to lock into current low interest rates,”
London to record slowest house price growth
London is set to register the slowest rate of house price growth the next half a decade, rising 12.4 per cent.
The East of England and the South East are forecast register the second and third slowest rates at 18 per cent and 19.1 per cent respectively.
Read more: Property transactions surge to record high in June