Planning an escape to the country? You're not alone. More and more of us are joining the 'race for space' as work patterns shift and we rush to move away from the nation's big cities — and the latest research suggests that will have a significant impact on house prices.
Savills predict that property prices across the UK are set to rise 21.1% over the next five years — but the spread of growth will not be equal. Property markets furthest from the capital will see the strongest growth, the agents suggest, with London expected to have the weakest percentage house price growth in Britain.
Leading the way will be the North West and Yorkshire & The Humber, with 28.8% and 28.2% increases respectively. London will see less than half that growth, with a 12.6% rise expected by the end of 2025. Country house prices are set to increase by 20.5% in the same timescale, driven by a desire for space and lifestyle changes.
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'The move to the country trend shows no sign of slowing,' says Lucian Cook, Savills' head of residential research. 'In particular, this points to a continuation of the country house revival and a demand for lifestyle relocation and second homes that will favour locations such as Devon, Dorset, Norfolk and Suffolk.'
| Region | 5-year growth |
| North West | 28.80% |
| Yorkshire and The Humber | 28.20% |
| East Midlands | 24.00% |
| West Midlands | 24.00% |
| Scotland | 22.80% |
| Wales | 22.80% |
| UK average | 21.10% |
| North East | 20.50% |
| South West | 18.70% |
| South East | 17.00% |
| East of England | 17.00% |
| London | 12.60% |
Source: Savills
Savills also points to the easing of lockdown measures, the speed of the vaccination programme and government support of the housing market as contributing factors to the healthy market.
Those changes in the market have been reported since last summer by agents, but they received fresh impetus in the budget on 3 March, which brought an extension to the Stamp Duty holiday until the end of June. There was also a move to help shore up the lower rungs of the property ladder, with help for those with small deposits — typically first or second-time buyers — in the form of government guarantee to encourage lenders to offer 95% mortgages.
'The expectation that interest rates will stay lower for much longer than was predicted pre-pandemic, means there remains capacity for medium-term house price growth despite the unexpectedly strong performance of last year,' adds Mr Cook.
'Across the country as a whole 5-year price growth of around 20% looks sustainable without unduly depleting mortgage affordability.'
Meanwhile, home-hunters have been warned to expect longer buying timelines due to estate agents 'making hay while the sun shines'.
Property platform WiggyWam reports that the extension to the stamp duty holiday would lead to an influx of buyers and a greater work burden for agents and lawyers, leading to lengthier processes.
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Credit: Savills
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