Welcome back to the Experience Invest blog, your one-stop-shop for UK residential property news. Continuing with the theme of UK house prices that we tackled in our last post, now we’re looking at new figures which suggest that along with rental values, they are set to soar over the next decade.
The Experience Invest team recently reported that Halifax Bank expects UK residential property values to grow at a moderate pace in 2016. They found that average house prices expanded 9.7% year-on-year to October 2015, but said that they’d only grow by around 4% to 6% next year.
UK property industry trade bodies the National Association of Estate Agents (NAEA) and the Association of Residential Letting Agents (ARLA) are optimistic about the long-term prospects of the nation’s housing market. The BBC reported that both Associations recently forecast that the nation’s average house price would increase 50%, from £280,000 to £419,000 by 2025. Meanwhile, they estimated that the average price for a property in London would double to £931,000 within the next decade.
This predicted house price increase assumes that the rises witnessed in the past decade or so will continue throughout the course of the next ten years. To meet NAEA and ARLA expectations, UK house prices would need to shoot up by 4.1% every year. Average London residential property values would have to increase even further – by 6.3% per year.
Commenting on the report, Mark Hayward of NAEA said: “House prices are only going to go one way, and unfortunately that is up. For so many already priced out of the market, this is news aspiring house buyers will not want to hear. Ongoing house price inflation, combined with low wage inflation, tighter lending restrictions and a shortage of affordable housing, means owning a home will continue to be distant dream for many.”
This is set to boost the UK’s rental market, according to NAEA and ARLA, who expect the average cost of renting a home in the UK to climb 27%, from £134 per week to £171, throughout the next decade. Meanwhile rental values in London are estimated to go up by 3% every year from £234 now to £314 by 2025.
About Experience Invest
Experience Invest is a London-based independent property company specialising in residential investments, student property and care home investments. The company works with clients across the UK and internationally, and is regularly featured in the property news – see The Telegraph, on Yahoo Finance, and by Reuters for examples of recent articles.
Experience Invest recently announced the launch of One Wolstenholme Square, a brand new residential development in the heart of Liverpool. If you are interested in finding out more about this exciting residential investment opportunity or would like to explore our full selection of buy-to-let opportunities please visit the website for full details.