4 Key Trends that will Affect the UK Property Market in the Next Five Years

The average house price growth in the mainstream market over the next five years is predicted to be 13.1%. The northern region of England, where the property market, business climate, and economic prospects are all booming, will experience the highest rises.

However, there are several specific events and trend shifts that will tilt the balance in the UK real estate market. If you want to find out more visit Housing Digital to read many more articles or carry on reading.

Interest rates and regulations impacting mortgages

We have seen a rapid raise in house prices in the past year, but they are hopefully set to slow down eventually. As interest rates rise, this affects the mortgage market, which is supposed to increase slowly enough.

When it comes to regulations, the Bank of England has proposed relaxing affordability stress test rules, meaning it might make borrowing easier. Although, the requirement still stands that no more than 15% of bank’s lending can be at a loan-to-income ratio of 4.5 or more.

Location choices post-pandemic

How people live and where people want to live, have been something that was brought on by the pandemic. More homeowners are now wanting more space to be able to work from home, as well as to have more garden space.

A lot of people now hunting for family homes are focusing on the commuter belts, as being able to commute easily has remained important, as hybrid working patterns have become more established.

Environmental issues

There has been a bigger drive for zero-carbon homes, which has been all thanks to the influence of COP26, these homes could be a real change within the UK property market in the coming years. This may drive a big change for any private landlords, people might reconsider the type of home they are investing their money into. There might be a surge in demand for more modern homes, as they tend to be more energy efficient than older properties.

Big changes for developers

There has been an upwards been in mini-housing, which has left housebuilders with healthy balance sheets. However, with the rise of build cost inflation and price growth, this upwards boom could be very short-term.

Though the government frequently changes the housing minister, the future of housing policy is still unknown. The ambiguity is not expected to be resolved anytime soon given the ongoing volatility surrounding the Conservative leadership.