One-fifth of Britain’s homes have appreciated more than the average salary in the past 12 months, a new report says.
The average worker took home £30,500 last year, but 21 percent of homes in Britain ‘earned’ more than this amount.
It’s the latest evidence of a red-hot real estate market that has recovered from a shutdown at the start of the pandemic, with the help of pent-up demand and a stamp-duty holiday.
In Hastings, East Sussex, 62 per cent of homes increased in value in the past year more than the average local salary of £25,800
Homes in the Southwest are most likely to earn more than the region’s average salary, according to real estate website Zoopla
The investigation by real estate website Zoopla revealed that the equivalent of 4.6 million properties across the country have increased in value at more than the normal annual wage.
Zoopla compiled the survey using monthly home price estimates for each home in the country and US data. It found that homes in the Southwest are most likely to earn more than the region’s average salary.
In the past 12 months, 29 per cent of homes in the region have increased in value at more than the regional average salary, which is currently £29,000.
Homes in the Southeast are the second highest earners compared to the median salary. In that region, 28 percent of properties rose in the past 12 months at more than the regional average salary of £32,900.
London may have skyrocketing property prices, but it ranks third for above-average salaries.
Nearly a quarter of homes in the capital – up 2 percent – rose over the past year by more than the average London salary of £37,300.
‘The amount we earned on our flat is close to my salary,’ says flat owner
Russell Maddison and his wife Hyun Kim – better known as Helen – live in North London
Russell Maddison and his wife Hyun Kim – better known as Helen – live in North London.
Their house in Hendon has increased in value by a similar amount to Russell’s salary.
Russell said: ‘When we bought our first house we wanted to be in an area with lots of greenery, and you just can’t find that green open space in central London at an affordable price.
‘Hendon was the perfect compromise – right next to the green open space of the Welsh Harp Reservoir, yet no more than half an hour by train to work.
“We really wanted to move to a regeneration area because it helped our budget, and we did our research, looked at the plans and considered the potential of the whole area, not just what we could see at the time.
‘The decision paid off as just three years later the one bedroom flat we had bought was worth £320,000 at £202,000 – mainly due to the rise in prices resulting from the regeneration of the area.
‘I even found out that the amount we were earning from our apartment is close to my salary and this enabled us to buy a larger two bedroom apartment in the same development for £465,000.’
“It’s a great feeling to see prices go up if you’ve bought early,” he says.
‘But you have to be careful. You have to be able to look ahead, look at the plans and what’s in the pipeline and try to visualize the final product. When you move in at the beginning of a development, you have to take into account some inconvenience along the way.’
Despite houses in the North and Central countries rising less in money terms than their southern counterparts, the lower house prices in these regions and the pace of house price growth mean that a remarkable proportion of houses are still rising at a higher level than local wages. , the report said. Zoopla.
It said 18 percent of homes in the Northwest, 17 percent of homes in the East Midlands, 14 percent of homes in the West Midlands and 9 percent in the Northeast have increased in value more than the average. salaries in these areas in the past year.
In Scotland it is 9 percent, while in Wales it is 22 percent.
House prices in some commuter hotspots have also outperformed local salaries over the past 12 months.
In Mole Valley, Surrey, 54 per cent of homes rose more than the average local salary and in St Albans the figure stands at 46 per cent.
In Adur, Sussex, 60 percent of houses increased in value more than the average local salary
|Surface||Average salary||Average Property Value||% of homes that have increased in value over the area’s average salary in the past 12 months||Number of homes that have increased in value above average in the region in the past 12 months|
Rural & Coastal Hotspots
The shift of some homeowners from urban to more rural living during the pandemic has also caused house prices in more rural and coastal areas to rise faster than local salaries.
In Hastings, East Sussex, an impressive 62 per cent of houses rose in value in the past year more than the average local salary of £25,800.
The figure is also high in Adur, in Sussex, at 60 percent. Dorset saw 47 percent of houses increase in value more than the average salary. In the Cotswolds it is 46 percent.
Gráinne Gilmore, of Zoopla, said: ‘Since the reopening of the housing market after the initial lockdown in May last year, there has been strong demand from home buyers.
This demand is supported by people looking for more space, making a lifestyle change or climbing the first rung of the real estate ladder.
At the same time, the savings of up to £15,000 being offered as a result of the stamp duty holiday in the 12 months to July also encouraged people to get moving.
Hundreds of thousands of households have moved into their new homes in the past year, but activity has been so high that the stock of homes for sale has eroded, putting upward pressure on house prices, with value appreciating more than 9 percent in some parts of the country.
“When this price increase is translated into pounds and pence, it means that one in five homes has appreciated in value by more than the equivalent of an annual income in a 12-month period.
|Region||Average salary||Average Property Value||% of homes with a value increase of more than the regional average salary in the past 12 months||Number of homes that have increased in value more than average regional salary in the past 12 months|
|Yorkshire and the Humber||£28,700||£183,000||17%||321,000|