UK house prices show no sign of coming down any time soon, with record hikes reported every month since the end of the Covid-19 lockdown in May. Recently, most house price predictions have focused on the immediate future of the property market, that is: will house prices go up or down in the next few months?
However, the latest house price analysis by Office for Budget Responsibility, Savills, and Knight Frank has focused more on the longer-term prospects of property prices in the UK, and the conclusion is that we can expect to see further prices rises, up to a total of 14.5 per cent over the next four years.
So, even if house prices take a dip in 2021 following the end of stamp duty holiday and the worsening of the coronavirus recession, the long-term prognosis is still pointing to steady – if not extraordinary – house price increases.
This will come as an obvious relief to current home owners who are planning to sell and move within the next five years. With an average of £33,877 added onto the value of a UK property, the fears of negative equity that have been strong throughout the pandemic now seem to be unfounded.
The North West and Yorkshire and the Humber are due to see the largest percentage uplifts, at 14.9 and 14 per cent respectively. This equates to a house price increase of £24,833 by 2024 in the North West and £23,213 across Yorkshire and the Humber.
At 9.1 per cent, London is expected to see the lowest rate of property price growth by 2024. However, with the average house price in the region currently at £479,609, the capital’s homeowners will enjoy the largest monetary increase in values with a jump of £43,644. The South East will also see one of the biggest monetary increases up £40,178 from £324,014 today. Founder and CEO of GetAgent.co.uk, Colby Short, commented:
'The property market is booming at present, however, the huge rates of growth currently being seen are likely to subside over the coming months. Particularly as we approach the stamp duty holiday deadline.
'That said, the long-term view of the market is good and the general consensus is that a more subdued but stable rate of growth should prevail.
'While this will result in a slower rate of house price growth to what we’re seeing currently, it should ensure positive movement across the UK market, with house prices increasing substantially regardless of where you live.'
Sadly, all of this means yet greater unaffordability of housing for first-time buyers. With wage growth highly unlikely to increased at the same rate as house prices, aspiring home owner's only hope is more house building and (if it's ever delivered) the new government-backed five-per-cent mortgage scheme.
Already in a position to buy? The data is clear: the longer you wait, the more expensive property will get, so now's as good a time as ever to get onto it. We've teamed up with online mortgage expert Habito: use their free mortgage comparison tool below to see how much you could borrow.