As we move into Autumn and winter, price growth is expected to slow, ending the year at 4.5 per cent across Great Britain, according to the report.
A second wave of lockdown-induced demand will keep price growth in positive territory at 3.5 per cent in 2022, three per cent in 2023 and 2.5 per cent in 2024.
London is set to underperform the rest of the country until the house price cycle ends in 2024. Hampton’s forecast is for prices in the capital to end the year up 1.5 per cent and then rise by 1.0 per cent in 2022, 1.5 per cent in 2023, before accelerating to 3.0 per cent in 2024.
The North East will be the top performer over the next four years. House prices are expected to rise 21.5 per cent in Q4 2024, outpacing the Great Britain average of 13.5 per cent.
A record-breaking first half of the year
More homes will have sold in 2021 than in any year since 2007. Hamptons forecast 1.5m completions in Great Britain in 2021.
COVID induced changes mean households will make more moves than pre-pandemic times. Hamptons forecasts that transactions will fall marginally to 1.25m in 2022 before reaching a new normal of 1.3m in 2023 and 2024.
The rapid pace of rental growth will slow. We expect rents in Great Britain to end the year up three per cent, before slowing to 2.5 per cent in 2022 as affordability bites.
By the end of 2024 rents are expected to have risen by 10 per cent, led by Southern regions. Meanwhile, London will lag until growth accelerates in 2024.
Aneisha Beveridge (pictured) head of research at Hamptons, said: “Back in the autumn of 2020, such were the economic challenges being faced that we could not have envisaged the extraordinary demand for relocation which we have seen this year. There has been a huge attitudinal change towards property, which cannot be attributed to the stamp duty holiday alone.
“People now place a higher value on their homes, having have spent more time in them than ever before. Flexible and remote working, which look set to continue, have encouraged households to make bigger moves. As a result, more homes are likely to have been sold in 2021 than in any year since 2007. This is why we also think housing activity will surpass pre-pandemic times in 2022 and beyond.
The report states: “The pandemic has accelerated the closing of the house price gap between London and the rest of the country. Even so, we still expect London to underperform the rest of the country until 2024, when the cycle is likely to end.
“While we will see a degree of levelling up over the next few years, the gap between house prices in the capital and the other regions is likely to be wider than that seen at the end of the previous cycle in 2007. And this divergence will set the pattern for future performance.”