Trump’s Policies Could Slash £10,000 from Your Home Value

Homeowners face a hit to property wealth as geopolitical tensions weigh on the market. Analysis shows the average owner could lose about £9,800 over the next three years.

Revised house price forecasts

Oxford Economics has reduced its house price outlook since the conflict began. Prices are now forecast to rise 1.4% this year, down from 1.8% previously.

Next year’s growth is trimmed to 0.5%, versus 2.3% before the war. By 2028, growth is expected at 2.4%, not 3.7%.

These downgrades lower the expected average home value at the end of 2028 from £290,600 to £280,800. The Land Registry reported the average home cost about £269,100 at the end of last year.

Mortgage rates and energy costs

Mortgage pricing has moved sharply higher in recent weeks. Moneyfacts data shows two-year fixed rates rose from 4.84% to 5.84% on average.

Five-year fixes climbed from 4.96% to 5.75%, the steepest monthly jump since the autumn 2022 mini-Budget. Wholesale oil prices also surged.

That rise followed an effective blockade of the Strait of Hormuz. Higher oil costs push up fuel and energy bills for households.

Inflation, jobs and affordability

Oxford Economics warns the conflict will push inflation higher. Its chief UK economist, Andrew Goodwin, expects inflation above 4% in the second half of this year.

Markets now see less scope for the Bank of England to cut interest rates. Higher mortgage rates reduce affordability and weaken buyer demand.

Goodwin also highlighted rising unemployment and weak company profits. These factors should dampen pay growth compared with 2023.

Regional shifts and market balance

Supply is growing while buyer enquiries fall. Zoopla’s Richard Donnell says buyer interest is lower than a year ago.

The number of properties for sale is near a decade high. London has about 16% more homes available than a year earlier.

Prices in London and the South-East are flat or falling. Scotland and the North-West are still recording modest growth of roughly 2.75% to 3.5%.

Buyer’s market ahead

Jonathan Hopper of Garrington Property Finders predicts a buyer’s market for the rest of the year. He notes regular discounts and competitive pricing by agents.

New listings around Easter will add even more stock. That increased supply will intensify pressure on sellers.

Personal stories illustrate strain

Filmogaz.com spoke with Heather Scott, 53, from Great Barton, Suffolk. She listed a four-bedroom bungalow at £475,000 last July.

Scott cut the asking price to offers over £450,000. She accepted an offer in December 2025, but the chain collapsed three weeks ago.

Her home uses heating oil, a cost not covered by the energy price cap. Half a tank that cost about £434 before the war now costs near £800.

Scott runs a home doggy daycare called The Pug Snug. She inherited the property with her sister and must sell to split proceeds.

She says the Renters’ Rights Act, due 1 May, is prompting some landlords to sell. That will add rental stock to the market and depress prices further.

Scott also estimates the house was worth about £550,000 when Labour took office in July 2024. She expects to need a mortgage for her next purchase and worries about higher rates for self-employed buyers.

Overall cost to homeowners

Combined effects of weaker price growth and rising costs translate into nearly £10,000 lost per household over three years. Slower gains cut the cumulative rise in average house values.

Political shocks can also shift sentiment. For example, discussions around Trump’s policies could make buyers more cautious and even slash £10,000 from some home value estimates.

Sellers now face a tougher market. Many are adjusting prices to attract the smaller pool of buyers.