New housing market forecasts suggest that parts of the Midlands and the North West are set to outperform London in long-term house price growth, marking a notable shift away from the capital’s historic dominance. According to property analysts, regional affordability and economic resilience are now playing a greater role in shaping future price trends.
Across Britain as a whole, house prices are expected to post modest gains over the coming year. Hamptons forecasts that average values will rise gradually, supported by easing inflation, lower mortgage rates, and improving affordability. However, this national picture masks growing regional differences.
London is expected to lag behind, with prices predicted to remain largely flat as the market absorbs recent and forthcoming tax changes. Hamptons suggests that buyer confidence in the capital is being dampened by higher transaction costs and wider political uncertainty.
At the top end of the market, particularly for homes valued close to two million pounds and above, small price declines are anticipated. Analysts believe this will be partly balanced out by stronger activity in the mainstream housing market, where demand remains more stable.
The Government’s decision to introduce a new high-value council tax surcharge from April 2028 is expected to weigh most heavily on expensive properties. Homes above the two-million-pound threshold will face an additional annual charge, increasing further for properties at higher values.
Prime rural and country locations previously benefited from strong demand during the pandemic-driven race for space. However, Hamptons believes that values in the top price brackets may now see a short-term adjustment as buyers reassess affordability under the new tax environment.
Despite this, the firm does not expect a prolonged downturn in high-value markets. Instead, it anticipates a one-off correction followed by a period of stabilisation as the market adapts to the new conditions.
Tax policy is increasingly shaping where growth occurs, with higher-value areas in London and the South seeing slower recovery. In contrast, regions with lower entry prices are attracting sustained interest from buyers priced out of the capital.
Sales volumes across the UK are forecast to remain relatively steady, supported by improving borrowing conditions. Hamptons estimates that affordability gains will help offset ongoing economic and taxation pressures.
While London has long been viewed as the safest bet for long-term house price growth, that assumption is now being questioned. Since the market low point following the global financial crisis, the capital has led the country in cumulative growth, but momentum is shifting.
Hamptons believes the coming years could represent a turning point. The East Midlands is expected to overtake London in total price growth, with the North West and West Midlands close behind soon after.
By the end of the current forecast period, house prices across Britain are expected to show strong long-term gains overall, but regional leaders are likely to change. The East Midlands is predicted to emerge as the strongest performer, followed by the West Midlands and the North West.
London, while expected to slip down the rankings in percentage terms, will continue to lead in cash-value growth. The higher starting point means homeowners in the capital will still see substantial increases in pound terms over time.
Hamptons’ research highlights that affordability and economic diversity are now stronger drivers of growth than historic prestige. Regional markets with better value and employment prospects are proving more resilient as the housing cycle evolves.
Looking ahead, analysts expect the next phase of the market to be shaped less by discretionary moves and more by practical decision-making. Policy, taxation, and borrowing costs are increasingly determining who can move, where they buy, and how often transactions take place.
While London remains a key part of the UK housing market, forecasts suggest its role as the clear growth leader is fading. As regional markets continue to strengthen, the balance of power in UK house price growth is gradually shifting away from the capital.
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