Price growth for the housing market in London is predicted to fall behind the performance of other housing markets in the region. The forecast is set to cover a span of five years which reverses a trend that has since stretched back for decades, a new report reveals.

Savills, an estate agent focused on the upmarket, has predicted that the average prices for houses in the capital are expected to fall 1.5% for this year alone and 2% in the next year. Pricing is expected to flat in the year 2019 before it will finally start growing.

The values of properties in London are expected to rise by 7.1% from 2018 to 2022. But this is seen to be far below the performance of other regions. It will be sharply lower from the 56% rate of growth that has been experienced in the capital for the last five years.

Across the country as a whole, Savills has predicted that the growth in the house pricing will halve to about 14% in five years time. This is when compared to the 28% growth that has been recorded since the year 2012.

This particular reverse trend stretches back to the 1980s where the prices of houses in the London area have always been known to grow at a much faster rate when compared to the rest of the country. Back in August last year, the capital recorded an average house price of £484,000. Meanwhile, the rest of the UK recorded an average of £226,000.

The forecast by Savills however, states that the house prices in the capital are likely to rise below the predicted inflation rise of 9.5%. This is expected to cause a fall in the values of real property in the area. In the national level, the housing market has shown resilient growth this year. The average pricing is likely to rise by 2%- clearly different from the envisaged stagnation that the estate agent predicted last year.

Savills’ head for residential research, Lucian Cook, stated that the uncertainty brought about by Brexit and what it means for the economy as well as how it is expected to impact finances in households will continue to act as the reason behind the lag in housing prices. He also stated that the capacity for growth is present the moment that there is better clarity. Still, this is going to be constrained not only in the rise of rates but also with the ability of the public to secure a mortgage especially in high-value locations like London.

The North-west is expected to see the fastest growth in housing prices in the country at a surge of 18.1%. Meanwhile, 17.6% rate is expected in the Yorkshire and northeast as well as the Humberside region. Scotland is expected to see a 17% growth.

It has also been anticipated by the estate agent that rent prices will see a faster growth when compared to house prices in the London area. This is a first since 2011. A rise of 17% is predicted in five years time despite the 3% fall that has been experienced this year.

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