A new forecast from real estate adviser Savills predicts the North West of England will see the strongest house price growth — of about 24% — between 2020 and 2024 “reflecting the strength and diversity of the regional economy and the capacity for higher loan to income borrowing.”
Savills said the North West will be followed by Yorkshire and the Humber — at 21.6%.
Wales and Scotland will also perform strongly, with price growth around 18% and 20% respectively.
“UK house prices are forecast to rise by an average of 15.3% over the next five years, with significant variation between regions, and between the prime and mainstream markets, particularly in London,” said the Savills report.
“Prime central London, where median values stand at just over £2.75 million, is forecast to be one of the strongest performing markets, reversing a trend seen over the past five years.”
At a national level, Brexit and election-related angst will continue to act as a drag on the market over the short term, but the firm expects prices to rise broadly in line with incomes thereafter.
“We anticipate a continuation of trends seen historically, where London and the South East underperform markets in the Midlands and North,” said Lucian Cook, Savills head of residential research.
“This stage of the cycle appears to have begun in 2016, coinciding with the referendum, when London hit up against the limits of affordability.
“Markets further from the capital, such as Leeds, Liverpool, and Sheffield, were much slower to recover post financial crisis and have much greater capacity for house price growth relative to incomes, even as interest rates rise.”