Savills Research have revised their projections for UK property prices. Once again, investors in the North and Midlands look set to see the strongest gains.
Savills largely stand by last November's prediction of a rise of circa 13% nationally for the five years as a whole, though they anticipate more 'front loading' then they previously thought. They foresee a pronounced north-south divide, with rises of 15% plus in most of the UK but London and the South East averaging 5% to 8%.
In the short term, Savills see further upward price pressure due to the imbalance between demand and available stock. The Royal Institute of Chartered Surveyors has reported enquiries exceeding new instructions consistently over the last three years. This gap is widely seen as a good indicator of short term price movements.
"So far, the twin pressures of rising interest rates and a bout of high inflation have done little to contain house price growth. Instead, strong demand for a shortage of stock has caused a continuation of the robust house price growth seen in 2020 and 2021."
Savills believe that house price growth will be strongest in those regions where affordability is greatest. Since the previous market peak in 2006/7, property values have increased the most in the South East and affordability looks stretched, so they look towards the North and Midlands to be the strongest performers over the coming years.
The full report is available on Savills website at -