Savills 2031 Forecast: Why the North Leads UK Property Investment

Savills expects UK house prices to fall 1.5% in 2027 before recovering from 2028. The North West is forecast to rise 23.3% by 2031, against 8.1% in London.

Savills has downgraded its UK house price outlook, forecasting a fall in 2027 before recovery from 2028. Beneath that headline sits a widening regional divide. For investors deciding where to invest in property in the UK, the five-year figures point north, and property investment in Manchester features prominently. Savills names the city among markets combining affordability with strong employment and investment prospects.

Invest in Property UK: Savills' Regional Forecast to 2031

Savills expects the North to outperform over the five years to 2031:

• North West: +23.3%

• North East: +22.2%

• Scotland: +21.6%

• Yorkshire and the Humber: +21%

• Wales: +21%

• London: +8.1%

Average prices across the three northern English regions remain below six times earnings. In London, the ratio is 11.3. Lower entry multiples combined with stronger forecast growth in the same locations form the core of the regional case.

A Short-Term Correction Before Recovery

Savills forecasts a 3.5% fall in London, the South East and the East of England in 2027. Nationally, prices are expected to dip 1.5% before rising 3.5% in 2028, 5% in 2029, 5% in 2030 and 3% in 2031. Average national prices are forecast to rise 15.8% over the five years to 2031. For patient capital, the 2027 softness may offer a more favourable entry point.

Bank of England Review: Under Consideration, Not Decided

The Bank of England is reportedly considering raising the high loan-to-income threshold from 4.5 to five times household earnings, according to the Financial Times.

UK Finance estimates the change could release lending capacity equivalent to 7% of annual new residential mortgage lending. Lenders would still run affordability checks, and Savills no longer expects average mortgage rates below 5% until early 2028.

Whether this lifts prices or only transaction volumes remains open. The reporting frames the answer as dependent on whether extra lending "stimulates more sales or simply encourages buyers to offer higher prices." Our reading is that any price effect is most likely where price-to-earnings ratios are highest, such as London.

Investor Implications: Buy-to-Let and Regional Selection

• Professional advantage. Savills expects buy-to-let to stay below its long-term average, citing higher taxation and tighter regulation. It expects this to accelerate the shift towards larger, professional landlords, which favours well-capitalised operators. This aligns with wider evidence that the UK buy-to-let sector continues to demonstrate structural strength amid market transition.
• Houses over flats. Savills expects houses to outperform flats, which face affordability pressure, building safety concerns and higher supply.
• Regional shortlist. Manchester, Leeds, Liverpool and Bristol are named as markets combining relative affordability with strong employment and investment prospects. Leeds investment property and property for sale in Liverpool warrant the same scrutiny. The case for Manchester is also supported by signs that the Manchester rental market continues to show structural strength for professional investors.
• Prime London later. After several years of price declines, prime London may recover later in the forecast period, improving relative value. Property for sale in London may suit a longer hold. For additional rental-market context, see Prime London Rental Market Outpaces Global Cities with 5.3% Growth

Before you buy property in the UK, test each target on yield, entry price and the 2028 to 2031 recovery window, rather than on the 2027 headline. The best property to invest in the UK will be the one that holds its value through the correction, not the one that avoids it.

Conclusion: A Regional, Long-Horizon Case

The forecast describes a 2027 pause followed by regional recovery, not a collapse. For investors comparing property investment in Manchester with London, the case rests on choosing the right region and holding through the cycle. For overseas buyers considering whether to buy property in the UK, Savills' data supports a regional, long-horizon strategy.