What might happen to house prices over the next five years?

Monika Haidar, partner, residential conveyancing London at full-service legal firm Gilson Gray, said: “Although house prices are rising at a more measured pace than in previous years, the trajectory still points upwards.

 “London, long the preserve of high-net-worth buyers, may be entering a period of relative stagnation. Changes to the tax regime, coupled with wealthy investors relocating to more favourable jurisdictions, have softened demand at the very top end of the market. Growth in the capital will continue, but at a slower rate than in regions such as the North West, which remains buoyant.

 “The greater challenge, however, lies in the leasehold sector. Once a staple of first-time buyers and small investors, flats are becoming increasingly difficult to sell. Eye-watering service charges, opaque management practices and the still unresolved issue of doubling ground rents have all served to deter would-be purchasers. Add to this the legacy of unsafe cladding, new fire safety obligations and the burdens of the Building Safety Act, and many observers fear a looming crisis.

 “Further uncertainty comes from Westminster. Reports this week suggested the Treasury is exploring plans to scrap stamp duty in favour of a so-called ‘wealth tax’ levied on homes worth more than £500,000. Crucially, the liability would shift from the buyer to the seller. While ministers moved swiftly to deny the claims, the speculation has rattled the market. As the saying goes, there is rarely smoke without fire.

 “Looking ahead, regional housing markets are likely to outperform London in the short to medium term, buoyed by affordability and stronger local demand. However, the leasehold sector remains exposed to regulatory and financial headwinds, with the potential to act as a drag on wider confidence.

 “Policy clarity on taxation will be critical as a shift in the burden from buyers to sellers would reshape transaction dynamics, potentially dampening supply. For now, steady but uneven growth appears the most likely path for the housing market over the next 12–18 months.”

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