Why House Prices Will Continue to Increase in the UK

Despite the promise of thousands of new homes being built in the UK to ease the impact of rocketing prices, they continue to rise across the UK.

London is the epicentre of the housing crisis, which has developed over the past 20 years. The average price of a house in the London borough of Kensington and Chelsea, the most expensive borough in London, is over £1.3 million.

But even in the cheapest boroughs, house prices have been on the rise for a long time.

Since the beginning of the 1980s, the population of London has increased by more than 2 million inhabitants and in the next 20 years, it is forecast to increase by at least 1.5 million.

This will inevitably continue to create demand for homes and increase their value.

Here are more reasons why house prices will continue to rise in the capital and the rest of the UK.

Growing population

It’s not just the fact that more people are moving to the big cities, it’s the fact that the population is getting older and net migration continues to attract more people to the UK compared to those leaving it.

Remember, the UK is a very small country even compared to our European neighbours such as France, but the population figures are very similar. This means that there is a lot less land to build homes.

So just like London, space is at a premium across the UK.

Transport Links

The best example to use to highlight the impact of transport links increasing the value of homes in an area, is that of Crossrail.

12 years ago, the route of the new Elizabeth tube line was announced, with brand new stations being built at a cost of at least £1 billion each and a total cost of at least £18.25 billion.

This caused an overnight explosion in house prices around the likes of Hanwell and Forest Gate.

Recently, the High-Speed Rail 2 project was also given the stamp of approval by the UK government, connecting London with Birmingham and Manchester with lightning-fast trains which will reduce journey times significantly.

As a result, it is inevitable that house prices will rise further in these transport hubs.


Inflation is a natural economic process which happens as an economy grows and more wealth is distributed. Over the past 40 years, the proliferation of technology and access to information has allowed brand new industries to be created and hundreds of billions for the likes of Mark Zuckerberg, Jeff Bezos, Warren Buffet and Bill Gates alone.

The equation is simple, if there is more money for everyone, the cost of food, shelter and transport will also increase.

This has naturally caused an increase in the price of almost everything in the developed world.

Even despite the ongoing Coronavirus outbreak, the global economy will continue to grow in the long term as more and more innovations are discovered and technology progresses.

This will lead to even more wealth being created, further rises in inflation and further rises in house prices.