Average UK house price growth will reach 2.2 per cent this year, a rise of £4,460 that will see the average home worth £210,400 by next Christmas.
That’s the forecast from property consultancy BNP Paribas Real Estate and it comes despite the possible market uncertainty caused by the snap General Election to be held this summer and by the long-running Brexit negotiations of the coming years.
The bank says even London house prices will return to growth in 2017, rising by 1.3 per cent by next Christmas and reversing a decline in prices reported by the Royal Institution of Chartered Surveyors and some high end estate agencies.
The research found London prices would rise by 6.8 per cent over the next four years, to £505,297 by 2021.
“The big debate in London is the extent of the impact on the £1,000 to £1,500 per square foot market. While we have seen some adjustment, people now realise that high stamp duty may be here to stay and pricing has adjusted accordingly. While 2017 may be a year of relative stagnation this market should return to stronger growth thereafter” forecasts John Slade, BNP Paribas Real Estate UK chief executive.
The research highlighted a strong performance in several regions, with the South West (up 22.2 per cent by 2021), the East Midlands (up 13.6 per cent) and West Midlands (rising 13.1 per cent) forecast to perform well over the next four years, driven by core cities according to the bank.
Only the North East will see prices lower by the end of 2020 than they are now - but even here there may be some good news.
“At a practical level, the story will become less about regional trends, with growth and activity focused on micro markets with a strong business and consumer economy. For example the North East features an extremely wide range of growth at a city level, with Newcastle Upon Tyne performing significantly more strongly than the regional average and likely to experience a less dramatic down cycle” says Simon Durkin, UK head of research at BNP Paribas Real Estate.
Here’s the regional picture painted by BNP Paribas Real Estate, based on some Nationwide figures:
- London price change by end 2020: +6.81%
- South East +17.29%
- East Anglia +8.72%
- East Midlands +13.07%
- West Midlands +13.59%
- South West +22.21%
- North West +7.63%
- North East -1.49%
- Yorks/Humberside +6.04%
- Wales +4.26%
- Northern Ireland +0.08%
- Whole UK +10.14%