There’s a pretty broad spread of forecasts amongst the top 15 prime property research units that have thrown in their numbers so far.
PrimeResi Property Price Forecasts 2015
- Prime central London: +1%
- Greater London: +2.8%
- National: +3.4%
Based on an average of the top 15 prime residential forecasts so far; read the detail on each of the predictions here
May’s general election is, of course, the major feature on the horizon, with a strong consensus that polling day will be the year’s pivot-point. Winkworth, taking it to extremes, is predicting a 5% drop in central London’s house prices in the run up to May, followed by a 5% increase through the second half of the year, leaving the market with no change in 12 months’ time.
That 0% forecast is a popular one in the capital: Knight Frank also put it in for central London, while Hamptons’ and Savills’ respective +0.5% and -0.5% for PCL is as close as it gets without saying it. Both Savills and RICS have gone with the zero across Greater London.
Because of the election – and because of one policy in particular – the range of market forecasts in prime central London is relatively extreme, from -5% to +5%. It all depends on who wins in May and whether Osborne’s SDLT reform has done enough to quash Miliband’s thirst for a mansion tax. Chestertons and Savills both thought it was too big a call to make, opting instead to issue two sets of forecasts for central London: one assuming a Conservative win (no mansion tax) and one assuming a Labour-led win (which could/would result in some kind of annual levy on £2m+ homes).
Savills believes that PCL prices will plummet by 5% if a mansion tax kicks in next year, while Chestertons is a little more positive, putting its weight behind a 1.5% price rise even if Labour walks a majority (+5% if a Tory triumph). Savills is still a touch pessimistic without a new high value homes levy, though, plumping for a price drop in PCL even if the Conservatives win and dismiss all the mansion tax chat for another four years. Only Carter Jonas has joined the firm in forecasting a price drop – also of 0.5% – for prime central London in 2015.
In Greater London, the Centre for Economics and Business Research stands alone in forecasting a reduction in house prices. Everyone else has gone positive, with CBRE going wild with a +7% forecast. Hamptons provides the voice of reason, with a conservative (small c) +1.5% across the wider capital. The average prime resi forecast for Greater London stands at a very reasonable +2.8%.
It’s a similar picture nationally: the CEBR thinks prices across Britain will drop a bit (by 0.8%) while CBRE thinks they’re in for a 6% increase over the next 12 months. It all averages out at a +3.4%.
Taking a longer-term view, almost everyone is on the same page: prices are going to carry on up, but not at the same pace as we’ve seen in London over the past few years.
Here’s the detail on those forecasts from individual research units:
N.B. Different research units use different borders and definitions for central London, Greater London, and the Nation. This article fudges the edges a bit, but the gists of forecasts remains true despite a few roads (and occasionally Scotland) being caught in no-man’s land.