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norht-south house price gap

Slowing house price growth could return London affordability

The gap in property prices between the north and south is expected to narrow in the next five years, thanks to a rapid rise in values in the north-west.

Leading estate agency Savills has analysed the current property market and made its forecast for  the next half-decade.

Savills predicts that average house prices will rise across the UK by 15.3 percent but those prices will be widely varied across the regions.

For example, the north is expected to benefit from greater rises than areas in the south.

Higher growth in north

Savills has picked out Scotland, Wales and all areas north of the Midlands as the places where prices will grow by 18 percent or more.

However, all areas in the Midlands and further south will see much lower growth.

The Savills research suggests house price growth in London will be 4.0 percent in the next five years.

While that’s much lower than previous rises, it will mean the capital’s property may return to affordability for many buyers and home movers.

Underperforming south

Lucian Cook, head of Savills residential research, said: “We anticipate a continuation of trends seen historically, where London and the south-east underperform markets in the Midlands and north.

“This 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. They have much greater capacity for house price growth relative to incomes, even as interest rates rise.”

About the Author Frances Traynor

Fran is the content writer for Capital Conveyancing, producing articles on all aspects of the conveyancing process and around the UK property market in general. If there is a topic you'd like to see covered on these pages, please drop Fran a line on [email protected]