The average UK house price is forecast to climb significantly over the next five years, despite a subdued property market in early 2025.
According to the latest analysis from property consultancy Savills, average home prices across Britain are projected to increase by 24.5 per cent by 2029, driven by easing mortgage regulations and improved affordability.
While growth expectations for 2025 have been revised downward—from an earlier 4.0 per cent forecast to just 1.0 per cent—Savills remains optimistic about the longer-term outlook. The firm now predicts the average house price will reach £448,600 by the end of 2029, up from £362,300 in mid-2025, marking a projected rise of £86,300.
The first half of 2025 has seen a weaker than expected performance in the housing sector, attributed to ongoing economic and geopolitical volatility. Market activity has also been distorted by recent stamp duty changes in England and Northern Ireland, which prompted a rush of buyers at the start of the year.
However, recent adjustments by mortgage lenders—particularly more flexible affordability stress tests and increased lending limits—are expected to boost both house prices and transaction volumes in the coming years. These regulatory changes are likely to support more first-time buyers and mortgaged movers, helping them step onto or progress along the property ladder.
Interest rates have eased as expected, enhancing buyer affordability compared to 2024. Yet wider geopolitical tensions, including new tariffs and global trade disputes, have added uncertainty to future interest rate movements.
Savills has noted that concerns about potential tax increases could have a dampening effect on the prime housing market, particularly in London and the South East.
Despite a slow start to 2025, total house sales are projected to reach around 1.04 million by year-end, in line with earlier expectations. Elevated housing supply levels may limit price growth in the short term, but buyer demand is forecast to strengthen by early autumn.
A potential base rate cut in August, coupled with a more competitive mortgage market, is expected to drive this renewed interest—especially among first-time buyers.
Research supporting the forecast utilised data from the Land Registry and Nationwide Building Society.
Savills’ Five-Year Regional House Price Growth Forecast (2025–2029):
* North West: 31.2%
* Scotland: 29.4%
* Wales: 28.2%
* Yorkshire and the Humber: 28.2%
* West Midlands: 27.6%
* North East England: 26.4%
* South East England: 20.4%
* South West England: 20.4%
* East Midlands: 20.3%
* East of England: 19.2%
* London: 15.3%
With demand expected to rebound and affordability improving, the UK housing market looks set for a stronger performance in the medium term, offering optimism for buyers, sellers, and developers alike.
