Average house could cost almost £1m in 20 years
If property prices continue to rise over the next few years, the average house price in England could hit £301,864 by 2027 and £983,826 by 2037, new research has revealed.
Analysing data from the Land Registry over the past 20 years, online estate agent eMoov.co.uk has calculated the percentage growth in property prices across England and Wales. The same increase was then applied to today’s average property prices to estimate how much properties will cost in 10 and 20 years’ time if house price growth continues at the same rate.
If prices across England were to rise by 29% as they have done since 2007, it would bring average house prices in 2027 up to £301,864. Meanwhile, in London house buyers could be paying an average of £866,719 if property values continue to rise by 80%. In the South East, prices could rise from today’s average of £313,334 to £445,159 in 10 years’ time – a 42% increase.
On a positive note, some areas will remain more affordable for house buyers: in both Wales and the North West, the average property in 10 years’ time could cost £154,072 and £158,131 respectively, while the East and West Midlands would also be more affordable, with an average of £205,870 and £183,883 respectively.
Using eMoov’s calculations, one area that could see prices fall over 10 years is the North East – down from £126,989 to £121,699.
Heading for £1 million
Property prices in England would go up by 320% over 20 years, and eMoov admits that this pace of growth is unlikely to continue over the next 20 years. But if it did, the average property would be priced at £983,826.
In London, if prices continued to go up by 480%, the average house would cost £2,792,783, while they would hit £1,422,708 in the South East over 20 years.
Meanwhile, Wales and the North West would continue to be more affordable, with average property prices of £494,731 in Wales and £533,010 in the North West.
Over 20 years, the West and East Midlands would become much less affordable at £560,037 and £666,178 respectively.
While prices in the North East fell over 10 years, they were more stable over 20 years, so prices would go up, with the average price at £380,753 – the most affordable area in England.
“Housing bubble unlikely to burst soon”
Russell Quirk, founder and chief executive of eMoov.co.uk, says: “Despite the usual industry speculation, it's not likely that we'll see a bursting of the house price bubble any time soon, but perhaps a slight deflation temporarily. Should this be the case, this research highlights the near impossible task faced by the next generation of aspirational buyers and acts as a warning to the government should it fail to address the current lack of property available, which is seeing prices once again reach dangerously inflated levels.
“The property boom in several regions of England has made it increasingly more expensive to get on the ladder, and the figures anticipating the next two decades only further attest to the importance of investing in a home as soon as possible if the trend in increasing property values is to persist.
“It is stomach churning to think that should prices continue the way they are, there will be just one real area of property affordability left across England and Wales in 20 years’ time, with the average house price in England approaching the £1million mark and three regions tipping beyond this.”
|Region||Average House Price (2007)||Average House Price (2017)||% Change (Last 10 Years)||Average House Price (2027)|
|East of England||£194,994||£278,349||43%||£397,335|
|Region||Average House Price (1997)||Average House Price (2017)||% Change (Last 20 Years)||Average House Price (2037)|
|East of England||£59,081||£278,349||371%||£1,311,380|
Everything you own: all your assets (property, cars, investments, savings, insurance payouts, artwork, furniture etc) minus any liabilities (debts, current bills, payments still owed on assets like cars and houses, credit card balances and other outstanding loans). When you’re alive this is called your wealth; when you’re dead, it becomes your estate.
This is the opposite of inflation and refers to a decrease in the price of goods, services and raw materials. Economically, deflation is bad news: the only major period of deflation happened in the 1920s and 1930s in the Great Depression. Not to be confused with disinflation, which is a slowing down in the rate of price increases. When governments raise interest rates to reduce inflation this is often (wrongly) described as deflationary but is really an attempt to introduce an element of disinflation.