Five Year Forecast 2021

Jennet Siebrits, our Head of Research, shares the latest Five Year Forecasts broken down by area, giving you insights on the residential housing market today and how we see it evolving in the next five years. 

The housing market outperformed expectations in 2020, and defying the economic backdrop, UK house prices rose by 8.5%, according to the ONS. This reflected an initial surge of pent up demand following the first lockdown, which was later compounded by the stamp duty holiday. The market was also buoyed by behavioural changes, including a shift in demand towards larger homes.

Despite starting the year in lockdown, we expect the residential market to continue strongly in 2021. The market remains supported by government initiatives; the tapering of the stamp duty holiday will prevent a “cliff edge” reaction, especially as it will be accompanied by the introduction of the mortgage guarantee schemes. In addition, as restrictions are lifted, the vaccine programme rolled out, and the economy reverts to growth, post-pandemic life will bring a wave of improved consumer sentiment.

Regional House Price Forecasts

 

Regional House Price Forecasts 

 2021   2022   2023   2024   2025   5 yr total
London 5.9 3.0 3.1 2.8 2.8 18.8
South East 7.7 5.0 3.9 3.6 3.6 26.1
South West 7.1 4.5 3.4 3.1 3.1 23.0
East of England 6.5 4.8 3.8 3.4 3.4 23.9
East Midlands 4.7 4.8 3.7 3.2 3.2 21.2
West Midlands 5.9 4.4 3.7 2.8 2.8 21.2
North East 4.7 3.9 2.9 2.5 2.5 17.6
North West 7.1 5.3 3.6 3.1 3.1 24.2
Yorkshire and The Humber 7.1 5.3 3.7 2.9 2.9 23.8
Wales 5.9 4.2 3.1 2.8 2.8 20.2
Scotland 2.4 4.4 3.3 3.0 3.0 17.2
UK 5.9 4.5 3.5 3.0 3.0 21.5

Source: ONS, CBRE Research

 

Regional Rental Forecasts

 

Regional Rental Forecasts  2021  2022  2023  2024  2025

 5 yr total

London -0.2 3.6 3.5 3.5 2.6 13.6
South East -0.3 1.7 4.3 4.0 2.7 13.1
South West -0.2 1.6 4.0 3.7 2.5 12.3
East of England -0.2 1.4 3.8 3.6 2.4 11.8
East Midlands -0.2 1.4 3.5 3.3 2.2 11.0
West Midlands -0.2 1.0 2.6 2.5 1.7 8.2
North East -0.1 0.9 2.3 2.2 1.5 7.4
North West -0.2 1.4 3.5 3.3 2.2 11.3
Yorkshire and The Humber -0.2 1.0 2.6 2.5 1.7 8.4
Wales -0.2 1.0 2.5 2.3 1.6 8.1
Scotland -0.2 1.1 2.8 2.6 1.8 9.2
UK -0.2 1.3 3.3 3.1 2.1 11.0

Source: ONS, CBRE Research