Rising employment rates and increases in earnings are driving property prices in Wales; the country is expecting a 2.88% average price increase by 2021.

This is the lowest increase across 12 UK regions, but an increased demand for housing is still expected to create growth in the residential housing market over the next three to five years.London is the hub of the UK property market and expects a 11.88% average price increase by 2021, the highest in the UK

Predicted Property Hotspots

With over 1,680 miles of coastline, mountains and national parks Wales offers spectacular natural beauty, as well as a thriving centre of employment and culture in its capital city, Cardiff.

The largest upwards increase in average house prices is expected to occur in the following three areas:

  1. Monmouthshire in South East Wales
  2. The Vale of Glamorgan in South Wales
  3. Cardiff in South Glamorgan

Rising employment rates in an area increases local house prices and the top three regions in Wales that are expected to see a jump in property prices all have growing job opportunities. Monmouthshire has one of the highest current employment rates of any local authority area in Wales (76.9%), meaning that average household incomes in the area are particularly strong, fuelling the pressure for future house price increases. Welsh capital, Cardiff, is expected to experience one of the highest levels of short to medium term employment growth in the country over the 2017-2021 period (with growth of around 1.5%), which will place additional demand for housing in the area and push up property prices.

Another key indicator of housing demand, impacting prices, is residential property rates. Monmouthshire and Cardiff have experienced a high rate of growth in private housing market rental levels, indicating the likelihood of increasing demand for house prices in the area.

A rise in earnings and employment growth in an area also indicates that house prices are set to rise. In the Vale of Glamorgan, average earnings per full time worker are around 13% higher than the UK average, helping to fuel potential future increases in average house prices. The area is also experiencing one of the highest levels of short to medium term employment growth in Wales over the 2017-2021 period (with expected growth of nearly 1%), which will fuel additional demand for housing in the area.

Investment Snapshot

  • Investors in Wales own two properties on average. The average total value of a property portfolio in the region is £804,693
  • Across all UK respondents, one in 10 (11%) own property/properties in this region. Forty-two per cent of these properties are being used for rental income
  • Over a third (38%) of respondents in Wales are planning to buy new property/ properties in the next three to five years.
  • They are modest about their investment prospects – investors in the Wales expect the average value of the property / properties they own to increase by 7.1% over the next three to five years (compared to national average of 8.0%).

Key findings

The Barclays UK Property Predictor reveals the areas across the UK where house prices and rental incomes are expected to rise. The research uses factors such as rental trends, employment levels and commuter behaviours, as well as a survey of high net worth individuals to understand where and why they plan to buy in the future.

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