The firm then 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 the 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.
James Forrester, Managing Director of Barrows and 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."
