The consultancy is one of the world’s leading property specialists and they are pointing to fast-rising house prices, increasing confidence about the economy and low interest rates which are combining to push up rental values with landlords in London and the South East of England likely to benefit the most.
In addition, mortgage approvals are running at their highest level since 2008 after 62,000 applications were approved in August.
The CBRE’s head of research, Jennet Siebrits, said: “With improvement in lending continuing there’s been a significant increase in demand across the whole property market.”
The government’s controversial ‘Help to Buy’ equity loan scheme has been particularly successful in helping to boost the property market and helping to deliver 15,000 reservations since April.
However, CBRE is predicting that the second phase of the Help to Buy scheme will become a ‘game changer’ which will see around half a million prospective buyers entering the property market.
The main boost for London’s surging house prices is coming from overseas investors with buyers moving their money into the UK which they see as being more politically and economically stable than many other countries.
In addition, easier mortgage funding is also helping to fuel the increase in land prices around the country as property developers look for more prime residential development sites.
The average cost of UK home increases
The prediction from CBRE would see the cost of the average UK home rising from £247,000 over five years to £281,990.
The office for National Statistics in its latest house price index said that year-on-year house prices had increased by 3.8% in the UK, which match the prediction coming from CBRE.
In addition, those predictions are backed up by the Land Registry which, in its latest report, said house prices had increased by 3.4%, with all English regions experiencing increases with the biggest monthly rise being seen in the North East.
While this is good news for landlords with property portfolios, CBRE is also highlighting that house prices have now smashed their 2008 levels when the market crashed.
However, house prices are still around 10% less than were recorded at the peak of the property boom in 2004.
Buy-to-let valuations rocket
But that's not the only good news for landlords with buy-to-let portfolios because chartered surveyors Connells Survey & Valuation say the number of valuations they undertake is accelerating.
In its latest report, the firm says there is strong growth in every property sector with buy-to-let recording an impressive 66% increase in September compared to August.
John Bagshaw, the firm's corporate services director, said: “In the past year the situation has shifted and it feels like September has been a tipping point.”
