The average price of a London home will climb at least 31 percent to 500,000 pounds ($790,050) by the end of the decade, according to a forecast by the Center for Economics and Business Research.
Price appreciation will be driven by the British capital’s ties to fast-growing emerging markets, a “high concentration” of service firms and an economy that isn’t reliant on government spending, the London-based research group said in a statement yesterday. Other cities will experience slower growth due to cuts in government spending, the company said.
“This last feature of the London economy will shield the capital from the worst effects of public-spending cutbacks,” CEBR said. “High rates of immigration to the capital bring a range of skills, languages and international commercial links which are forecast to fuel London’s economic and house-price growth.”
CEBR expects the average London home price to be 383,000 pounds in 2013.
Outside of London, house prices in southeast England will rise by 25 percent on average by 2018 and residences in eastern England will climb by 26 percent, the firm predicted. Price appreciation will be slower elsewhere, with valuations rising 6 percent in Northern Ireland and 2.3 percent in northeast England, according to the statement.