British Home Prices Expected to Trail Inflation Through 2027
British home prices are expected to record weaker growth than previously forecast due to elevated mortgage rates and an uncertain economic environment, according to a Reuters poll of 16 property market experts.
The poll found that average UK home prices will increase by 1.3% this year, down from the 1.8% forecast in June. Price growth is expected to reach 2.0% next year and 3.3% in 2028.
London is expected to perform more weakly than the wider UK market, with a 1.4% decline in home prices this year followed by a 0.9% increase next year.
The housing market is being affected by the wider inflation and interest-rate environment, with the Bank of England keeping its key interest rate unchanged at 3.75%. The US Federal Reserve and European Central Bank have also moved towards tighter policy in response to renewed inflation pressures.