Recovery imbalances across regions, with more difficulties ahead
We have cut our forecast for UK GDP growth in 2024 to 0.4%, from 1.3% three months ago. We expect that all regions will avoid a contraction this year, albeit some such as Scotland more narrowly than others.
What you will learn:
- Recently published ONS GVA data have given us a much clearer picture of how regions have recovered from the impacts of the pandemic in 2020 and have helped to inform our outlook for the regions.
- Over the medium term we expect to see employment trends moving broadly in tandem with GVA. London will top the employment growth table, averaging 1.1% growth annually between 2023 and 2027.
- We estimate that house prices are currently around 30% overvalued and that a price correction is well underway—we anticipate a 10.4% fall nationally between 2023 and 2025. Whilst all UK regions are forecast to experience a correction in house prices in the years to 2025, London is one of the few expected to see a significant annual contraction in 2023.
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