Business

House prices will rise £52,000 by 2021, economists predict

UK house prices will rise by £52,000 in the next four years says Cebr
Gary McDonald Business Editor

HOUSE prices will leap more than £50,000 higher on average by 2021 despite Brexit uncertainty, economists predict.

The average UK house price across the whole of 2017 will be £220,000, marking a £9,000 increase compared with 2016, according to the Centre for Economics and Business Research (Cebr).

By 2021, the average home is set to be worth around £272,000, its report predicts - a £52,000 increase compared with 2017.

Cebr expects property values to climb at a slower pace over the next couple of years as Brexit negotiations progress, with annual increases below 5 per cent. This compares with a 7.5 per cent year-on-year increase in house prices recorded in 2016.

It expects UK property prices to grow by around 4.4 per cent during 2017 - the slowest pace seen since 2013. But from 2019, growth is expected to pick up, with an annual increase of 5.7 per cent pencilled in for that year and increases of around 6 per cent in 2020 and 2021.

House prices in Northern Ireland rose by almost 6 per cent in 2016, and the average standardised price across all property types stood at £125,480. That compares to £97,428 at the bottom of the market in 2012, but way off the bubble-era peak of £224,670.

Meanwhile the Royal Institution of Chartered Surveyors (RICS) has urged land, property and construction sectors in the north to collaborate better to help end rising homelessness and deliver more affordable homes.

The most recent official government monitor revealed that in 2015/16, some18,600 households presented as homeless in Northern Ireland, with a 13 per cent increase since 2012/13 to 11,200 people in what are described as full duty applicants (a term whereby if you meet certain criteria the Housing Executive is responsible for finding you somewhere to live).

RICS has urged those who work in the property industry to pledge their support for its ‘A Home For Cathy' campaign, which aims to deliver solutions to alleviate the country's affordable housing crisis.

The campaign coincides with the 50th anniversary of Ken Loaches seminal film 'Cathy Come Home' (an influential production which ignited a debate about homelessness at the time).

Former RICS president Michael Newey, who is part of the Homes for Cathy Group, said: “It's hard to comprehend that over 50 years later – since 'Cathy Come Home' first aired - we are once again in the grips of another housing crisis with rocketing unaffordability levels pricing even those on good incomes out of the market.

“Rising prices along with recent caps to housing benefits, including the abolition of housing benefit for those under 21, are key reasons why those on lower incomes are being pushed out of the market."

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