After a stable year, UK property market outlook is positive
UK house price growth has been slowing since the summer of 2014, although the annual change remains positive and more robust growth is forecast cumulatively over the next five years, according to the latest outlook review report.
Price growth across the nation is expected to be 1% in 2018, reaching 14.2% cumulatively between 2018 and 2022, says the residential forecast from international real estate firm Knight Frank.
But in London, prices are forecast to fall by 0.5% in 2018, but cumulative price growth over the next five years is positive at 13.1%, it also says.
‘The momentum in house price growth is slowing in many parts of the country, and we expect price rises to remain muted overall next year amid increased economic and political uncertainty in the run-up to Brexit and amid more muted forecasts for wage growth,’ the report explains.
It also points out that the market is localised with slightly stronger growth in the Midlands, the East of England and the North West, a continuation of the trend that has emerged this year.
‘Once the Brexit deal is completed, we forecast rising momentum across the market, with price growth reflecting this in many locations. The variations currently observed in the prime housing markets in London and beyond are set to continue,’ it adds.
‘The UK may now be entering a period of interest rate rises, but even so, we expect rates to be low compared to long term norms by the end of the forecast period. While development levels are rising across the country, the shortage of new homes is unlikely to be fully reversed in the coming years, and that will underpin pricing. On the other hand, factors such as deepening affordability pressures and property taxes, will continue to weigh on pricing,’ it concludes.
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Source – Property Wire