Real Estate - United Kingdom | Statista Market Forecast

The Real Estate market market in the United Kingdom is estimated to reach a value of US$23.32tn by the year 2024.
Within this market, the Residential Real Estate segment is expected to dominate with a projected market volume of US$19.30tn in the same year.
This segment is anticipated to exhibit an annual growth rate of 2.52% from 2024 to 2029, resulting in a market volume of US$26.41tn by 2029.
When compared globally, it is worth noting that United States is expected to generate the highest value in the Real Estate market market, reaching US$132.0tn in 2024.
The United Kingdom's real estate market is experiencing a surge in demand for residential properties due to low interest rates and an influx of foreign investors.

Definition:

The real estate market refers to the transaction of properties, including residential properties (such as houses and apartments) and commercial properties, such as office buildings and industrial properties. Apart from property sales, this market includes leases and the value of real estate.

Structure:

The real estate market comprises residential and commercial real estate. The residential real estate market covers real estate transactions and leases, and residential real estate leases are divided into apartment and house leases.

Additional information:

The market contains the following KPIs: real estate value aggregated for all countries and regions, average real estate value, real estate transaction revenue, number of real estate sold, number of leased and owned real estate, average room per resident, and dwelling type shares. The dwelling type shares comprise the share of the population that lives in houses and apartments. These shares are displayed for real estate owners and real estate renters as well.

Residential real estate (houses and apartments)
Commercial real estate (office buildings, retail spaces, warehouses, industrial properties)

Real estate agencies
Construction companies
Accommodation services, such as Airbnb
Commercial real estate leases and transactions
Publicly owned buildings used by the local government
Buildings used for public health care services

The Real Estate market in United Kingdom has shown significant growth and development in recent years.

Customer preferences: One of the key customer preferences in the UK Real Estate market is the desire for properties with modern amenities and energy-efficient features. Buyers and tenants are increasingly looking for properties that offer sustainable living options and reduce their carbon footprint. Additionally, there is a growing demand for properties located in urban areas that provide easy access to amenities such as schools, hospitals, and shopping centers.

Trends in the market: One of the major trends in the UK Real Estate market is the rise of co-living spaces. With the increasing cost of living and limited housing supply in major cities like London, many individuals are opting for co-living arrangements where they can share living spaces and amenities with other like-minded individuals. This trend is particularly popular among young professionals and students who are looking for affordable housing options in prime locations. Another trend in the market is the growing popularity of build-to-rent developments. These are purpose-built rental properties that offer high-quality amenities and services to tenants. Build-to-rent developments are gaining traction as they provide a hassle-free renting experience and cater to the needs of the growing rental market in the UK.

Local special circumstances: In the UK, one of the local special circumstances that has influenced the Real Estate market is the impact of Brexit. The uncertainty surrounding the UK's exit from the European Union has led to fluctuations in the market and affected investor confidence. However, despite the initial uncertainty, the Real Estate market in the UK has shown resilience and continued to attract both domestic and international investors.

Underlying macroeconomic factors: Several underlying macroeconomic factors have contributed to the development of the Real Estate market in the UK. The low interest rate environment has made borrowing more affordable, encouraging individuals to invest in properties. Additionally, the population growth and urbanization in major cities have increased the demand for housing, leading to a rise in property prices. Furthermore, the government's initiatives to support the Real Estate market, such as the Help to Buy scheme and favorable tax policies for property investors, have also played a role in the market's growth. These factors, combined with the stability of the UK economy, have created a favorable environment for the Real Estate market to thrive. In conclusion, the Real Estate market in the United Kingdom has experienced significant growth and development due to customer preferences for modern amenities and energy-efficient features, as well as the rise of co-living spaces and build-to-rent developments. The impact of Brexit and underlying macroeconomic factors such as low interest rates and population growth have also influenced the market. Despite the challenges and uncertainties, the UK Real Estate market remains an attractive investment option for both domestic and international investors.

Data coverage:

Figures are based on value of residential and commercial real estate, average real estate value, residential estate transactions and leases.

Modeling approach / Market size:

Market sizes are determined by a combined Top-Down and Bottom-Up approach, based on a specific rationale for each market segment. As a basis for evaluating markets, we use data from international organizations and industry associations. Next we use relevant key market indicators and data from country-specific associations such as GDP, price level index, household wealth, household size, number of renter and owner households, housing consumer spending per capita. This data helps us to estimate the market size for each country individually.

Forecasts:

In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the particular market. For example, exponential trend smoothing. The main drivers are GDP per capita, population, number of renter and owner households, price level index, housing consumer spending per capita.

Additional Notes:

The market is updated twice per year in case market dynamics change. The impacts of the Russia-Ukraine war are considered at a country-specific level.

This report presents a comprehensive analysis and additional information on the Financial market, in a PDF format.

The global housing market has slowed amid high inflation and soaring borrowing costs. Homeownership is one of the most universal signs of success and prosperity: It serves both as a source of stable and secure housing and a long-term investment. After the global financial crisis, property prices rose in many countries and especially in advanced economies. For more than a decade after that, the housing market has been on an upward trajectory, culminating in the housing boom during the COVID-19 pandemic. However, housing shortages in highly competitive markets, the recent rapid house price growth, soaring inflation, and consequently, some of the highest mortgage interest rates recorded in the past 10 years have led to the market cooling.

Japan is a country with very limited space for buildings, as mountains make up about three-quarters of its landmass. The country’s fairly large population is concentrated in major cities. The metropolitan area of Tokyo, home to a staggering one-third of the population, is the center of economic and political activity. As such, it boasts the highest property prices across the country. Driven by the weak yen, a tourism boom, and global investment, property and land prices surged in 2023 and 2024. Even some rural regions, which are generally confronted with economic stagnation and depopulation tendencies, have been affected by this trend.

The real estate market all around the world has been affected by the global pandemic. This historic event has changed the way we live, consume, and work. The real estate market in the Asia-Pacific region has experienced some turbulent and diverse changes depending on the sector, property type, and location. The commercial real estate segment, which includes offices, retail outlets, logistics centers, and many more, had to adapt to new conditions and demands. Furthermore, residential real estate suffered decreases in rental and capital values in some areas, with the exception of prime real estate, which experienced healthy growth in most locations.

Soaring inflation and aggressive mortgage interest rate hikes cooled the European housing market after a nearly decade-long period of growth. Since 2015, house prices in the European Union have grown by about 50 percent. When inflation in Europe started to rise at an alarming rate in 2021, the European Central Bank increased interest rates, resulting in substantially higher mortgage interest rates and a decline in homebuying. But how important is homeownership for Europeans?

Real Estate - United Kingdom

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