---
title: Knight Frank Upgrades UK Property Forecasts
description: Knight Frank raises UK property forecasts amid investor confidence and stable rates. See why the UK stays a top choice for global real estate buyers.
---

[Blog | Magnate Assets](https://blog.magnateassets.com)

# [Knight Frank Upgrades UK Property Forecasts](https://blog.magnateassets.com/uk-property-growth-forecast-knight-frank)

 Written by [Keith Egan](https://blog.magnateassets.com/author/keith-egan) | May 13, 2025

Knight Frank has upgraded its UK house price forecast for 2025 from 2.5% to 3.5%, citing a more stable interest rate environment and improving market sentiment. This revision also lifts the five-year cumulative growth forecast for [UK property](https://www.magnateassets.com/en/for-uk-property-investment) values to 22.8%, up from 19.3% projected in November.

### **Why the UK Remains a Top Destination for Global Property Investors**

Despite global economic headwinds, the [UK property market](https://blog.magnateassets.com/investor-visa-return-boost-uk-property-market) continues to offer a compelling combination of long-term capital growth, strong rental yields, and legal stability. For overseas investors, the UK represents:

- A transparent, rules-based investment environment
- Stable political and legal frameworks (despite current volatility)
- An undersupplied rental market, particularly in major cities
- A global hub with continued demand from students, professionals, and international tenants

This resilience is reflected in Knight Frank’s latest five-year projections:

#### **Knight Frank UK House Price Forecasts (% Growth)**

| **Year** | **UK** | **Greater London** | **PCL (Prime Central London)** | **POL (Prime Outer London)** | **Prime Country** |
| --- | --- | --- | --- | --- | --- |
| 2025 | 3.5 | 3.0 | 0.0 | 3.0 | 2.5 |
| 2026 | 4.0 | 3.0 | 2.5 | 3.5 | 3.5 |
| 2027 | 4.0 | 3.5 | 4.0 | 3.5 | 3.5 |
| 2028 | 4.5 | 3.5 | 5.5 | 4.0 | 4.0 |
| 2029 | 5.0 | 4.0 | 6.0 | 4.5 | 4.0 |
| Total | 22.8 | 18.2 | 19.2 | 19.9 | 18.8 |

Knight Frank sees the improving rate environment as a driver for buyer demand, particularly in more affordable and needs-driven areas outside the capital. Notably, Greater London’s outlook has strengthened to 18.2% growth over five years, up from the 15.3% forecast in late 2023.

### **Cautious Optimism in Prime Central London**

Forecasts for [Prime Central London](https://www.magnateassets.com/en/location/london) (PCL) have been slightly downgraded for 2025, now flat versus a previous 2% rise. This reflects recent uncertainty around the UK’s political direction and the government’s decision to replace the non-dom tax regime, prompting some wealthy overseas investors to leave.

Yet, long-term optimism remains. Cumulative growth in PCL is still expected to reach 19.2% by 2029. Given that average prices in this segment are still 18% below their 2014 peak, there is significant upside potential for investors seeking value.

### **Rental Market: Strong Growth Driven by Supply Crunch**

On the rental side, Knight Frank has marginally increased its five-year forecasts for both UK-wide and London rents due to an ongoing shortage of supply and robust tenant demand. The UK is now projected to see 18.8% rental growth by 2029, with London close behind at 17.1%.

#### **Knight Frank UK Rental Forecasts (% Growth)**

| Year | UK | Greater London | PCL | POL |
| --- | --- | --- | --- | --- |
| 2025 | 4.0 | 3.5 | 3.0 | 3.0 |
| 2026 | 3.5 | 3.0 | 3.5 | 3.5 |
| 2027 | 3.5 | 3.0 | 4.0 | 4.0 |
| 2028 | 3.0 | 3.0 | 4.0 | 4.0 |
| 2029 | 3.5 | 3.5 | 4.5 | 4.5 |
| Total | 18.8 | 17.1 | 20.5 | 20.5 |

The expected introduction of the Renters Reform Bill later this year may discourage new landlords and reduce supply further. Combined with stricter green regulations (EPC rating C required by 2030) and higher financing costs, some landlords are opting to exit the market, limiting rental stock.

Rightmove reports that new rental listings are still 18% below 2019 levels. As mortgage rates rise, the affordability gap between renting and buying will keep rental demand strong—an encouraging sign for income-focused investors.

**Magnate Assets Takeaway**

For overseas investors, the message is clear: the UK property market remains one of the most secure and rewarding long-term asset classes globally. With renewed confidence in the rate environment, constrained rental supply, and undervalued segments like Prime Central London, now is an opportune time to explore high-performing areas of the UK market.

Reach out to the [Magnate Assets](https://www.magnateassets.com/) team for tailored investment opportunities backed by data, insight, and hands-on support.

[View full post](https://blog.magnateassets.com/uk-property-growth-forecast-knight-frank)

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