House price growth set to soar by 18 per cent in the next five years
UK house price growth is set to grow by 2.5 per cent each year for the next two years, reaching 18 per cent cumulatively between 2018 and 2022, new research shows.
According to the latest analysis on the UK property market from estate agents Strutt & Parker, the figure in prime central London is set to be significantly lower, between -5.0 per cent and 0.0 per cent in 2018, but cumulative price growth over the next five years is forecast to be positive at 23 per cent, with a downside risk of 0 per cent.
Vanessa Hale, director of research at Strutt & Parker, said, “Whilst Brexit negotiations continue and political and economic conditions remain uncertain, we have held our residential house price forecasts for sales.
"We maintain that from 2019 onwards it is extremely difficult to forecast the housing market with any certainly, but we would expect some bounce back and a return to growth once more stability has returned to UK politics and the economy.”
According to the Nationwide House Price Index, UK property prices grew 2.5 per cent in the year to Q1 2018.
National house prices are now 16 per cent above the 2007 peak, with London prices 57 per cent above the 2007 peak.
Year-on-year growth in the year to Q1 2018 shows that on a regional basis the best performers have been: Northern Ireland (7.9 per cent), Wales (6.0 per cent) and the West Midlands (4.8 per cent).
Despite historically having one of the strongest growth rates in the UK, London showed the weakest growth in the country for the quarter (-1.1 per cent).
Total transaction levels for England and Wales look to be relatively equivalent to this time last year.
However, in Prime Central London, despite transactions picking up over the course of 2017, they are now below what they were last year and are very low by historic standards.
The firm has revised its forecast for Prime Central London lettings and is predicting lettings prices to be flat in 2018, before returning to growth in 2019.