UK homes could be worth as much as £ 9.2bn on the free market – four times the value of the UK economy and £ 550bn more than at the same time last year, he said. -on affirmed.
Home prices have skyrocketed since home buying restrictions began to ease in the spring of 2020, fueled by stamp duty cuts and a rush for big houses. The lowest mortgage rates on record also translated into higher prices.
Real estate website Zoopla said the recent boom meant Britain’s housing stock had grown by 20% to £ 1.6bn since 2016, and that an average house was now worth almost £ 50,000. more than five years ago.
The estimate is based on the website’s ‘automated valuation model’, which takes into account sales recorded in the land register each month and combines these prices with other factors, including owner-provided details and information. on schools and crime rates. It includes the 28.6 million homes in Britain, not just those that have recently been sold.
The numbers highlight the price gulf in different parts of Britain. Zoopla estimates that in Westminster, Kensington and Chelsea, two London boroughs covering 13 square miles, the combined house values are about the same as for all of Wales.
Houses in Westminster have been valued at a total value of £ 165bn, making it Britain’s most expensive borough, while those in Kensington and Chelsea have been valued at £ 141bn.
Official land register figures show that in Westminster the average price of a property was £ 898,000 in July, 3.1% lower than the previous year.
However, the Borough still boasts some of the most enticing prices in London – current listings include a 12-bedroom Mayfair townhouse on the market for £ 54.5million and a six-bedroom mansion with an asking price of £ 40million.
The report also breaks down the value of the housing stock in each region and compares it to the volume. This shows that although 12.7% of homes are in London, they represent 25.3% of home values in Britain. For the north-east it is 4.4% of the dwellings and 2.1% of the total value.
The report’s authors, Gráinne Gilmore and Izabella Lubowiecka, wrote: “Over the past five years, the total value of homes has increased by £ 1.66 billion, more than five times the total value of all transactions. UK housing in 2020. It is also about the same in value as the market capitalization of Apple, which is the world’s largest company by value.
“The rise in values since 2016 signals modest but sustained annual growth in UK house prices since then, supported by low mortgage rates, which has resulted in a cumulative 20% increase in house values.”
Neal Hudson, housing analyst at BuiltPlace, said the numbers showed the disparity in property wealth and how it was concentrated in London, and pointed to the “huge amount” in housing.
However, he added: “The value of a house is what a buyer is willing to pay for it… If everyone decides to move out of their house and they all try to sell at the same time, it is very. unlikely to be worth £ 9.2 tn.
Although prices have fallen since the large stamp duty cuts ended in June, there are signs that a mismatch between housing demand and the supply of properties for sale could push them up again.
The latest report from the Royal Institution of Chartered Surveyors (Rics) showed that after a “brief pullback” as the stamp duty deadline approached, buyers returned to the market in September.
The lack of available stock created competition among buyers, he said, and as a result, 68% more of its members reported price increases than reported decreases.
Simon Rubinsohn, Chief Economist of Rics, said: “The imbalance between supply and demand remains the most striking theme of Rics’ latest residential market survey. And member feedback gives little reason to believe this issue will be resolved anytime soon. “
He added: “Delivering more new homes is part of the answer, but it is essential that they are built in areas where the shortfall is most visible. It is also essential that the composition of the supply pipeline tenure has a broad basis to help address challenges in both the private rental market and in social housing.