Savills now expects house prices to fall 1.5% in 2027 and recovery to wait until 2028
The property firm's new five-year forecast puts growth at 15.8% to 2031, with northern England, Wales and Scotland expected to see the strongest rises.
By Daily Oracles News Team1 min read
Savills has pushed its expected housing recovery back to 2028. In a forecast published on Wednesday, the property firm said average mainstream UK prices would keep drifting lower through the rest of 2026 and fall 1.5% across 2027, before values start to climb again in the second half of 2028.
In its previous forecast, published in June, Savills was pencilling in a 2.5% rise for 2027. It now blames the drawn-out conflict in the Middle East, which it says has delayed any meaningful fall in mortgage rates and is weighing on buyer confidence.
The firm does not expect a sharper correction. It said most homeowners had already absorbed higher borrowing costs since late 2022, relatively few still need to refinance from deals below 2%, and the jobs market remains resilient.
The path to 2031
Savills forecasts growth of 3.5% for 2028, and 15.8% over the five years to 2031, or £56,500 on an average home. Savills' June forecast had given 18.5% for the five years to 2030.
First-time buyers are expected to lead the upturn from 2028, helped by more manageable deposits and government schemes.
The strongest percentage growth over the five years is forecast for northern England, Wales and Scotland, helped by relative affordability and economic prospects.
