London house prices have been dampened by changes made to stamp duty in spring 2016, as they have had a significant impact on the buy-to-let market from the additional increase in duty.
However, KPMG's projections suggest property prices will start to pick up by 2019, and London will be the driving force behind growth in the market by 2021.
The capital has unique characteristics that make it more resilient to fluctuations than other regions in the UK, according to KPMG chief economist Yael Selfin.
"London's property market isn't just made up of people's homes. Foreign investors plough money into property in the capital as it is seen as a safe haven asset, and they will continue to do so after Brexit, especially if sterling remains weak.
"If the UK's exit from the EU is done in a positive way, we're likely to see demand for property in the capital rise as it will remain one of the most vibrant and exciting cities in Europe."
Outside London, developments such as Crossrail and Thameslink are likely to continue boosting sales in areas such as Reading and Brentwood, while improvements to regions' infrastructure should have positive impacts in other areas, with HS2 supporting sales in Birmingham, while cities in the north of England, such as Leeds, Sheffield and Manchester should benefit from Northern Powerhouse-related initiatives.
KPMG said its projections assumed that the Bank of England would increase interest rates next year, which will feed through into mortgage rates, affecting the affordability of borrowing and slowing down the rate of house price growth.
Other factors affecting the projections include trends in regional employment and population, which will affect the degree of housing shortages experienced across regions.
Selfin added: "With so much going on in the UK at the moment, some fear that the housing market will be the first to snap if the mood changes around the Brexit process or when interest rates start to rise.
"Our analysis however shows that with the exception of a few areas in the south such as London, house prices are not particularly high compared to long-term regional valuations. Our projections see a more orderly transition over the next five years, with house price growth moderating further next year before gradually picking up momentum again from 2019."
Separate figures from Halifax published today show that UK house prices in the three months to September were 4pc higher than in the same three months a year earlier, while month-on-month prices are up by 0.8pc.
While the quarterly and annual rates of house price growth have improved, they are lower than at the start of the year, the bank said. "UK house prices continue to be supported by an ongoing shortage of properties for sale and solid growth in full-time employment".
Mark Harris of mortgage broker SPF Private Clients, said: "The housing market shows no signs of faltering, despite the ongoing Brexit saga and hints from the Bank of England that interest rates will need to rise sooner rather than later."
