Knight Frank have issued their latest UK residential Market forecast looking at what they believe is going to happen to property prices over the next five years.
Despite UK house price growth slowing since 2014, average purchase prices for properties throughout the country have seen steady increases. With the House Price Index indicating that the average sales price has increased by 5.4% in the latest report, the expectations of a fairly stable market in 2017 have been proved incorrect – much to the benefit of investors.
Knight Frank have predicted that the UK market will see an average of 1% growth in 2018 with London actually dropping by 0.5%. This is put down to increased economic and political uncertainty in the run up to Brexit and muted forecasts for wage growth. It is localised however with the Midlands, East of England and the North West expected to see greater growth – a continuation of the areas that have performed best in 2017.
From 2019, once the Brexit negotiations have been concluded, growth is expected to increase with average increases between 2018 and 2022 predicted at 14.3%. The growth in each area of the UK is due to be strong with Scotland predicted to have the lowest growth at 12% and the North West the greatest at 16.4%.
Prime markets are due to have more limited growth but this is only due to start from 2019 after the UK has left the European Union.
Investors looking for long term capital growth throughout their property portfolio look secure with everything working towards property prices increasing until 2022 – even with Brexit not due to be finalised until 2019.
The full report can be viewed here.