One in five homes has increased in value by more than the average salary in the past year alone. Is it time to check how much your home could be worth?
If you're a homeowner, you could be in for a surprise.
And that’s because one in five homes has ‘earned’ more money by simply existing as bricks and mortar than the average worker has in the past year alone.
In other words, 4.6m privately-owned homes have jumped in value by more than £30,500, the average UK salary, in the past 12 months, our latest research shows.
What could this mean for you?
If you are thinking of moving, you may be surprised by how much your home is now worth, particularly if you want to trade up the property ladder.
Top 10 areas where homes have ‘earned’ more than the average salary
Hastings in East Sussex has topped the ranking with the highest proportion of properties that have increased in value by more than the average pay packet during the past year at 62%, followed by Adur, also in East Sussex, at 60%.
The strong house price rises in these locations reflect the current trend among homeowners to relocate from urban to more rural areas during the pandemic.
Coastal locations were also popular, with 47% of properties in Dorset recording value increases that outstripped average salaries, while the rural locations of the Cotswolds and South Lakeland also made it into the top 10.
Another trend was strong price rises in commuter hotspots, with 54% of properties in Mole Valley, Surrey, increasing in price by more than the average salary, as did 46% of homes in St Albans and 45% in both Sevenoaks in Kent, and Bromley, south east London.
The regional picture
Homes in the south west were most likely to see price rises that outstripped the average salary at 29%, followed by the south east at 28%. Nearly one in four homes in London also increased in value by more than local pay during the past year, despite the fact that salaries in the capital are the highest in the UK at an average of £37,300.
Although house price growth in northern regions has been strong in percentage terms during the past year, the lower average values of properties there meant the gains have been lower in monetary terms. Even so, nearly one in five properties in the north west saw price gains that outstripped average local pay.
Why is this happening?
Demand from potential buyers has been strong since the housing market reopened after the first national lockdown, with buyers looking for more space and a different lifestyle as they no longer had to commute to work on a daily basis.
The stamp duty holiday has also helped to fuel momentum in the housing market.
Gráinne Gilmore, head of research at Zoopla, said: "Hundreds of thousands of households have made the move into their new home over the last year.
"But activity has been so high, it has eroded the stock of homes for sale, which has put upward pressure on house prices, with values rising by up to 9% in some parts of the country."
