By 2021, the average home is set to be worth around £272,000, according to a new report.
Residential property prices look set to increase significantly over the next few years despite Brexit-fuelled uncertainty in the market, new figures show.
According to the Centre for Economics and Business Research (Cebr), property values will rise by almost a quarter over the next four years – representing an average increase of £52,000 by 2021 as consumer confidence in the UK housing market remains robust.
Cebr forecast that the average price of a residential property in the UK will rise to £220,000 this year, marking a £9,000 increase compared with 2016, supported in part by a shortage of housing.
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By 2021, the report suggests that the average home in this country is set to be worth around £272,000, which if accurate would mark an increase of around £52,000 compared with 2017 and an increase of 23.6%.
House prices rose by an average of 7.5% last year, but Cebr expect values to slow to below 5% per annum over the next couple of years while Brexit negotiations take place.
However, from 2019 the economics consultancy believes growth will pick up, with an annual rise of 5.7%, followed by increases of around 6% in 2020 and 2021.
Kay Daniel Neufeld, a Cebr economist and main author of the report, commented: “Already towards the end of 2016 indicators pointed to a stabilisation in the housing market, a trend that has continued in the first months of 2017.
“Transaction numbers are slowly recovering from the introduction of a stamp duty surcharge on second homes in April 2016, which has led to considerable distortions in the market.
“Mortgage approvals, are nearing post-crisis heights, boosted by low interest rates and favourable borrowing conditions.”
Cebr’s predictions for average UK property prices over the next few years are as follows:
+ 2017, £220,000
+ 2018, £229,000
+ 2019, £242,000
+ 2020, £256,000
+ 2021, £272,000