The need for more space has driven the price of independent properties
According to the latest research from Halifax, an increase in demand from larger property buyers has led to the rise in the price of independent properties.
Analysis based on the Halifax Home Price Index found that the cost of the most extensive property types in the UK has more than doubled that of the smallest houses. Looking at price changes from March this year, during the lockdown period, and through the summer through September, prices for typical UK single-family properties increased by more than 5%.
This compares with an increase of 2.5% for a typical apartment during the same period and gains around 4% for townhouses and townhouses. Homeowners have found that prices are increasing at a faster rate than first-time buyers. For those buyers moving from one home to another, prices have typically increased 4% between March and September. That compares with a 2.4% increase for first-time buyers.
“Buyers want more spacious properties.”
Russell Galley, Halifax Managing Director, said: “We have seen a fundamental shift in buyer demand as a result of increased work at home and the desire for more space. There’s now evidence that this push for larger properties has been driving the mini-boom witnessed in the housing market since lockdown restrictions were first eased over the summer.
“However, this level of price inflation has not deterred prospective buyers, as in the three months through September; we received more mortgage applications from both first-time home buyers and relocators than at any time since 2008. However, we continue to make a note of caution on the long-term outlook for house price inflation, as the full economic impact of the pandemic is likely to be felt most intensely during the winter.”
All regions of the UK have seen increases in the median price of a typical single-family property. The most substantial inflation rates have been observed in the North West and Yorkshire and Humberside, which recorded inflation above 6%, followed by the East Midlands and the South West. In cash terms, the price of single-family homes in all of these regions has increased by more than £20,000 since March.
By contrast, price increases have been less significant in percentage terms in the South East and Greater London, both at about 2%, with price inflation for larger properties in these areas likely to be partially attenuated by the stamp duty holiday threshold £ 500,000.
Similar trends have emerged for townhouses, with the West Midlands (4.8%), the South West (4.6%), the North West (4.1%), and the East of England (4.0%) head, compared to modest gains in the southeast (2.3%) and Scotland (0.7%).
In general, the average price of a flat in the UK has risen relatively slowly or has fallen in some areas. Data for the six months to September shows that the costs of flats in the West Midlands (-0.1%), Yorkshire and the Humber (-0.3%) and the South West (-1.6%) are all lower than six months ago.
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