‘North-South Divide’: South East house prices to rise 24.8% by 2018; prices in North East to rise by only 2.3%
New Cebr forecasts show the price of a typical London home will rise to at least £500,000 by the end of this decade.
The leading economic think-tank expects a home in London to cost £383,000 this year.
Even though Cebr expects house price growth in London to be slower this year than in 2012, when the decade ends they forecast house prices in the capital will be over 30% higher than in 2013.
House price rises will be driven by London’s comparatively bright economic prospects. The capital enjoys: strong emerging market links; a high concentration of services firms; and a relatively low reliance on the public sector. This last feature of the London economy will shield the capital from the worst effects of public spending cutbacks. Finally, high rates of immigration to the capital bring a range of skills, languages and international commercial links which are forecast to fuel London’s economic and house price growth.
Daniel Solomon, Cebr Economist and main author of the report, said: ‘Before the decade is out, we predict the price of the average home in London will reach £500,000.’
‘House price rises will be driven by London’s comparatively rosy economic growth prospects, buoyed by IT, business and professional services.’
‘Nevertheless, house price growth in London will remain notably slower than in the boom years before the financial crisis.’
For further commentary and analysis please download the full report (below).