Savills’ revise their UK house price forecast

Savills’ revised UK house price forecast suggests a more positive outlook than previously anticipated, with an expected increase of 2.5% this year and a cumulative growth of 21.6% by the end of 2028. This upward revision is attributed to several factors, including slightly decreased mortgage costs, improved economic growth prospects, and a competitive mortgage market that has boosted buyer confidence.

Despite short-term uncertainties such as potential fluctuations in borrowing costs and political factors ahead of the General Election, Savills remains optimistic about the housing market’s trajectory. While they don’t anticipate significant further declines in mortgage rates this year, they foresee fluctuations in both house prices and debt costs. Additionally, they expect a stronger economic performance in 2025 and 2026, which could bolster buyer sentiment.

However, challenges with affordability are likely to persist, particularly in regions like London and the South East. Despite the positive overall outlook, Savills acknowledges that buyers may face difficulties due to affordability constraints, highlighting the ongoing issue of housing affordability in certain areas.

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