JLL Residential Forecasts 2024-2028
UK house prices are forecast to end the year down -6%, with the latest JLL five-year forecast leaving the UK outlook for 2023 unchanged. We anticipate a bottoming out of prices in mid-2024 but falls earlier in the year are expected to outweigh any second-half increases, resulting in single-digit annual falls by the end of 2024. Forecasts for 2025 and beyond predict a return to growth as we see more competitive fixed rates deals enter the market.
Rental growth so far in 2023 reached double-digit highs for new lets, due to the imbalance between available rental stock and tenant demand. We have upgraded our year end 2023 UK rental growth forecast from 4% to 6%.
Looking ahead, over the next five years, the lack of new rental stock, the result of fewer new home completions and a more challenging interest rate environment, will likely lead to rental growth surpassing wage growth. We forecast a 5% increase in rents across the UK in 2024. From 2025 onwards, we anticipate that more attractive mortgage rates will prompt more tenants to transition into homeownership, and this shift will bring about a better equilibrium between tenant demand and available rental stock.
To read more on our five-year forecasts download our report here