Homeowners are set to see their property values continue to rise over the next five years according to experts. This may help many of them choose whether they should remortgage because with such low interest rates, it may be a good investment as it might save them a substantial amount of money. According to Knight Frank, house prices are set to rise by over 20% up to the end of 2020. House price increases could equate to higher property values for homeowners.

Knight Frank had predicted that 2015 would bring in a cooling off period in the housing market in comparison to the rapid growth seen in 2014. They were close in their annual prediction and feel confident in forecasting that London will see slower growth than other areas in the UK next year, and overall house prices will continue to see growth over the next 5 years.

The threats possible to the UK housing market that could tilt the current forecast are interest rates rising quicker than consumers expect and/or a notable slowdown of the global economy.

Currently homebuyers are showing strong demand with first time buyers reported to be the most interested in the mortgage market, while buy to let landlords are the most enthusiastic borrowers for remortgages in the third quarter of the year.

The close of 2015 is expected to occur without any change to the current Bank of England standard base rate which has remained at 0.5% since March 2009. Lenders are thought to close out the year still in a competitive mode for borrowers’ attention and allowing their cheapest deals to remain available. However, in 2016 much is expected to change, particularly the low interest rates being offered by lenders as well as the Bank increasing their interest rate in a succession of small increments.

It is the possibility of the cheapest interest rates disappearing that could be pushing up demand by homeowners and homebuyers in the first half of the new year.