Hampshire has been forecast to be one of the top performing urban areas outside London for house price growth over the next five years, according to a report published by Savills recently.

Savills anticipates a modest, but progressive, improvement in mortgage lending and as a result the greatest impact is likely to be in higher value local markets with more in-built housing equity, most prevalent in the South of England.  Whilst the strongest five year growth will occur in the South and East of England, Savills forecasts that all regions will outperform London over the next five years in terms of price growth.

The UK mainstream housing market as a whole, will see average price growth of 25 per cent over the five years according to the report.

“With strong positive sentiment, we expect prices to rise by 17 per cent in the next three years alone,” says Lucian Cook, Savills head of UK residential research.  “But total five year house price growth will be capped by earnings growth, given the likelihood of interest rate rises that will erode mortgage affordability.”

Steven Moore of Savills in Winchester adds, “Given the diversity within the UK housing market, national measures of the performance rarely reflect regional or local market trends.  However, Hampshire, which represents much of the upper mainstream market in the region, is predicted to be one of the top performers over the next five years, driving housing market recovery and price growth.

“The extent to which lower value areas will follow this lead will be limited by the extent of ongoing constraints on mortgage lending. This means, even in a more widespread recovery, there will still be regional and local market divides.”