London Property Market Forecast: What Can We Expect?

The History of the London Property Market: How Have London Property Prices Changed?

The capital of England and a major tourist spot for visitors from around the world, London plays a huge part in not just the UK economy but the global economy too. London has long been a main point of interest when it comes to the UK housing market, attracting property investors from around the globe.

The London Property Market in the 1990s

Back in the 1990s, savvy investors snapped up properties in some of the most coveted London locations, many of whom were unbeknown to how central London property prices would grow by the 2000s.

In a feature by the Guardian in 2016, interviews were published with a range of people who purchased London real estate back in the ’90s and saw their property values grow. In one case, a man purchased a central London apartment for £218,000 in 1996, which was valued at a whopping £1.5 million by the end of 2015. In another, a Victorian terraced house was bought for £80,000 in Oxford and was valued at at least £525,000 by late 2015.

Brexit and the London Property Market Forecast for 2020

Many people believed that the slow in London property prices had come as a result of Brexit uncertainty causing UK property prices to plummet. However, figures showed that when it came to property prices after Brexit, the property market in many cities remained robust in the face of negotiations following the 2016 Brexit vote. Fast forward to 2020, with the UK having now officially left the EU, and many property experts have offered house price predictions for UK cities, including London.

So, will London house prices go up in 2020 and beyond? Overall, London property market forecast predictions from various property experts have revealed that London property prices are looking up. Thanks to the market certainty brought on by the 2019 general election result and the so-called ‘Boris Bounce’, house price predictions suggest London properties will see a level of growth over the coming years.

Covid-19 and the London Property Market

Often considered the best property investment possible, the London market has had quite a difficult few years due to Covid and Brexit.

As a result of the Coronavirus pandemic and its subsequent lockdown, the London property market, and the UK market overall, has had quite a turbulent year for much of 2020. As housing market activity slowed after the lockdown went ahead in March and fewer people were interested in buying new homes, the residential market came to somewhat of a standstill.

Following on from their last property price predictions for the UK, in which they stated a London property forecast decline of -2% in 2020, Savills have now changed London property predictions to show a larger drop of -7.5% this year. However, not only are London property prices forecast to change, but every other region in the UK is also set to see the same decline in 2020 due to the Covid-19 pandemic.

The good news is, that property prices in the UK are set to shoot up again once the economy has recovered. Savills predict that by 2021, North West house prices will have grown by 8.5%, and prices in the East Midlands will see a 7% increase. London property predictions by Savills also reveal an expected growth of 6% by next year, which is an optimistic figure. It’s worth keeping in mind, however, that although London property prices are forecast to rise, their five-year growth rate is the lowest out of all other UK regions.