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Future homebuyers could see house prices soar by £120k and deposit requirements jump by £12,000

The latest research by estate agent, Barrows and Forrester, predicts that the average UK homebuyer could see the initial cost of a mortgage deposit increase by more than £12,000 over the next 25 years as the average house price could hit £362,350.

Barrows and Forrester analysed historic house price data over the last quarter of a century and the rate of house price growth. Barrows and Forrester than used an ETS forecasting model including interpolation, accounting for seasonality, and based on the conservative lower level of the 95% confidence interval, to predict what the property market of the future could look like for home buyers and sellers. 

The research shows that should the market continue to see property values climb at the same rate, the average UK house price could hit £362,350 by 2045. This 51% increase from today’s current average of £239,196 would also mean that the average homebuyer placing a 10% deposit mortgage would be paying a huge £36,235; £12,315 more than the initial cost required today. 

Based on Barrows and Forrester’s forecasted growth figures, property prices in London could not only exceed the half a million mark, but they would reach a staggering £789,531 by 2045. As a result, the capital’s home buyers would be looking at a 10% deposit cost of £78,953; A £30,000 increase on today. 

Based on historic growth trends, the South East could also see the average house price break the half a million market, reaching a potential £524,726. Such growth would require home buyers to pay an additional £19,258 for a deposit on top of the current £33,215 already required.

The South West and East of England could also see the average property price climb by £151,255 and £167,135 respectively, while the East and West Midlands could also see prices climb by more than £100,000. As a result, homebuyers in these regions would also see a 10% mortgage deposit requirement increase by five figures.

Even house prices in the North East could climb by as much as £70,041 to an average of £201,742, requiring the average home buyer to place a 10% mortgage deposit in excess of £20,000. 

Managing Director of Barrows and Forrester, James Forrester, commented:

“The UK housing market has returned with a bang and house prices are once again starting to climb across much of the nation. This is a trend that we’ve seen maintained for much of the last twenty-five years and while there have been some economical corrections, the bricks and mortar market has not only recovered but has continued to appreciate beyond any previous levels seen. 

While we’ve pulled out our crystal ball of property price predictions there’s no real way of knowing what the future holds and what will happen to house prices. However, had you predicted today’s property values back in the late 90s you would have struggled to find someone to believe you and so who knows where the ceiling will be where current price growth is concerned.

Of course, the real aim of this research is to act as a warning shot to a government that has consistently neglected its responsibility to deliver affordable housing year after year. Despite promising to address the UK housing crisis on multiple occasions, the level of new homes being delivered is abysmal. 

This failure to increase supply is the driving reason behind the spiralling issue of affordability for many homebuyers and those that consistently recite promises of addressing this issue to win over voters should hang their heads in shame. 

We hope that they might listen to this prediction of future prices and refocus their attention on the delivery of affordable housing stock for the masses in order to prevent it. 

Unfortunately, based on their previous track record we have more chance of winning the lottery and the future homebuyer may well need to in order to buy. So let’s hope we’re not looking at such steep levels of price growth come 2045.”

Table shows the current and forecasted average house price in 2045 and the £ and % change by UK region
Location Current Average House Price Forecasted Average House Price in 2045 Forecast Change (£) Forecast Change (%)
London £489,159 £789,531 £300,372 61%
South East £332,147 £524,726 £192,579 58%
South West £264,886 £416,142 £151,255 57%
East of England £296,411 £463,546 £167,135 56%
North East £131,701 £201,742 £70,041 53%
North West £173,617 £263,066 £89,449 52%
East Midlands £202,345 £303,384 £101,039 50%
West Midlands region £204,886 £305,144 £100,258 49%
Yorkshire and the Humber £170,025 £244,906 £74,881 44%
Wales £172,828 £233,560 £60,733 35%
Scotland £155,191 £219,462 £64,271 41%
Northern Ireland £141,131 £115,628 -£25,503 -18%
United Kingdom £239,196 £362,350 £123,154 51%
Table shows the current and forecasted cost of a 10% mortgage deposit in 2045 and the £ and % change by UK region
Location 10% Mortgage Deposit 10% Mortgage Deposit in 2045 Deposit Change (£) Deposit Change (£)
London £48,916 £78,953 £30,037 61%
South East £33,215 £52,473 £19,258 58%
South West £26,489 £41,614 £15,126 57%
East of England £29,641 £46,355 £16,714 56%
North East £13,170 £20,174 £7,004 53%
North West £17,362 £26,307 £8,945 52%
East Midlands £20,234 £30,338 £10,104 50%
West Midlands region £20,489 £30,514 £10,026 49%
Yorkshire and the Humber £17,003 £24,491 £7,488 44%
Wales £17,283 £23,356 £6,073 35%
Scotland £15,519 £21,946 £6,427 41%
Northern Ireland £14,113 £11,563 -£2,550 -18%
United Kingdom £23,920 £36,235 £12,315 51%
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