The North West and Yorkshire & Humber are set to lead UK house price growth over the next five years, with Savills forecasting 25% gains to 2030 more than double London's projected 10.6% rise. Despite global geopolitical uncertainty and elevated mortgage rates, the revised Savills forecast positions Northern England as the UK's strongest regional investment opportunity, underpinned by affordability, resilience and sustained demand.
Affordability Drives Regional Outperformance
Savills' revised five-year forecast shows the North West and Yorkshire & Humber will gain 25% by 2030, significantly outpacing the UK average of 18.5%. The North East follows closely at 23.9%, while London and the South East lag at 10.6% and 13.4% respectively. This regional divergence is driven by affordability: Northern markets remain resilient when borrowing costs rise, while Southern buyers face stretched price-to-income ratios.
Dan Hill, research analyst at Savills, confirms: "Regional performance continues to be shaped by affordability. More affordable markets tend to be more resilient when borrowing costs rise, and we expect that to underpin outperformance across parts of the North, Scotland and Wales while mortgage rates remain elevated."
Growth Accelerates from 2027 Onwards
While Savills expects UK house prices to fall 2% in 2026 due to elevated mortgage rates, the North West and Yorkshire & Humber are forecast to remain flat this year avoiding the declines projected for London (-4.0%) and the South East (-3.5%). From 2027, Northern growth accelerates: both regions are forecast to gain 3.5% in 2027, then 6.5% annually from 2028 to 2030.
This phased recovery reflects improving economic conditions and easing affordability pressures. Lucian Cook, head of residential research at Savills, notes: "Affordability is less stretched now, compared with 2022, following a slower recovery in prices." For Northern England, where affordability cushions remain stronger, this translates into earlier and more sustained price growth.
Why Northern England Outperforms London
The 25% North West and Yorkshire forecast compares starkly with London's 10.6% projection. Southern markets face structural headwinds: higher absolute prices, weaker affordability, and elevated landlord sell-off driven by regulatory pressure. Savills expects "downward pressure on prices, particularly across submarkets in London and the South East" as landlords exit ahead of the Renters' Rights Act.
Northern England benefits from the inverse dynamic. Lower entry prices attract first-time buyers and investors priced out of the South. Rental yields remain stronger Manchester, Liverpool, Leeds, and Sheffield all offer superior income returns compared to London. For professional investors targeting capital growth plus yield, the North West and Yorkshire & Humber offer the UK's most compelling risk-reward profile.
Investment Implications: Follow the Forecast
For institutional and overseas investors, Savills' regional forecast is a roadmap. The 25% North West and Yorkshire projection represents £67,000+ average gains on a median property achieved in markets with stronger affordability, lower volatility, and higher rental yields than London. As mortgage rates peak in summer 2026 and begin easing from 2027, Northern England is positioned to capture the strongest phase of the UK housing cycle.
The forecast also validates the build-to-rent and single-family rental strategies already deployed by institutional capital in Manchester, Leeds, and Liverpool. Professional landlords operating at scale in affordable, high-demand Northern markets are positioned to benefit from both rental income growth and capital appreciation as the five-year forecast plays out.