Singapore’s Property Landscape: Midlands Set to Outpace London in Price Growth
Fresh data indicates a shifting dynamic in the UK property market, with house prices projected to rise by 2.5 per cent in 2026. The East Midlands is poised to overtake London in terms of long-term price growth, signalling a significant change in the regional housing market cycle.
London’s Shifting Fortunes
While London has experienced remarkable house price appreciation since 2010, this trend is expected to moderate. From the end of 2010, when house prices reached their lowest point, London saw an 84 per cent increase, surpassing all other regions and the national average of 74 per cent. However, projections suggest that London will fall to fourth place in terms of price growth, becoming the only region where average prices remain below their 2022 peak.
The Rise of the Midlands
The East Midlands is anticipated to emerge as the top performer, with a projected growth of 94 per cent by 2028. The West Midlands and North West are also expected to surpass London in price growth by the end of 2027, with anticipated growth rates of 90 per cent and 88 per cent respectively by 2028. This shift is attributed to the Midlands’ “stronger affordability and economic resilience” compared to the capital.
Regional Growth Projections
Here’s a breakdown of the expected property price increases between now and the end of 2028:
- West Midlands: A surge of 12 per cent.
- North East: A significant rise of 16.4 per cent, with an average home costing £161,770.
- East Midlands: An increase of 10.4 per cent.
- Scotland: A growth of 13.6 per cent.
- Yorkshire and the Humber: An increase of 12.5 per cent.
- London: A modest increase of 0.5 per cent.
London’s Challenges
Property prices in London are expected to remain sluggish in the coming years. Official figures indicate that annual house price inflation was lowest in London in the year leading up to September 2025. Prices in the capital fell by 1.8 per cent during this period, compared to a 0.8 per cent decrease in the year leading up to August 2025. The average cost of a home in London currently stands at £556,454.
In 2025, 14 per cent of London sellers sold at a loss, a significant increase from 6 per cent in 2016. Factors such as higher stamp duty and a potential mansion tax are deterring many from moving within the capital. First-time buyers accounted for half of all sales in London last year.
London has “consistently underperformed” against the rest of Britain in terms of property price growth since 2016, and this trend is expected to continue, with forecasts indicating zero growth in the capital next year.
The impact of the upcoming mansion tax on London’s property market is also a concern. While small price declines are anticipated in the £1.9 million-plus segment, this is likely to be offset by growth in the mainstream market, where improved affordability and easing mortgage rates are beginning to bolster buyer confidence.
Interest Rates and the Property Market
Inflation, currently at 3.8 per cent, is expected to fall faster than anticipated next year. This could prompt the Bank of England to implement two or three interest rate cuts in 2026. Interest rates are projected to be around 3.25 per cent by the end of next year, with typical mortgage rates stabilising at approximately 4 per cent.
This should improve the availability of mortgage deals below 4 per cent, even for borrowers with smaller deposits, which would support price growth and market activity. However, approximately 600,000 borrowers on “ultra-low” sub-3 per cent five-year fixed-rate mortgages will face higher rates in 2026 and 2027.
Overall, house prices across Britain are expected to rise by 2.5 per cent by the final quarter of next year, with stronger growth in the Midlands and North of England, where affordability is less strained. House price growth across Britain is expected to moderate to 2 per cent in the final quarter of 2027 and further to 1.5 per cent in the final few months of 2028.
Changing Buyer Behaviour
People are moving less frequently and are prioritising “future-proofed” homes. Properties in the prime country sector are likely to be affected as the mansion tax approaches. Homes above the £2 million mark in the countryside could experience a 5 per cent “price correction,” although this is expected to be a one-off event rather than a continuous decline.
“Necessity-driven moves” are expected to maintain property transaction volumes at around 1.15 million per year, slightly below historical norms. The absence of a stamp duty holiday, which traditionally stimulates activity, means that market sentiment will rely more on economic fundamentals.