“Safe as houses,” runs the old saying, and bricks and mortar have certainly been a good investment for many homeowners over the years. That’s confirmed by new research from the Halifax showing that, taken as a whole, the UK housing stock is worth more than double what it was 10 years ago.
According to Halifax housing economist Martin Ellis, there has been a “substantial increase in the value in housing assets, with all regions recording average annual increases of 7%-12%.” The total rise in value is estimated at £2000 billion in cash terms.
One feature has been the narrowing of the North-South divide, with larger increases in regions such as the North West, and Yorkshire and the Humber, than in the South East. Nevertheless, it’s Northern Ireland which has lead the way, with a rise of almost 200% in the ten years to 2009 – from an estimated £31 billion to £92 billion in total.
After years of gains, the period between mid 2007 and early 2009 saw falls in prices. The result is that the total value of private housing stock is now 8% lower than at peak. However, prices rose again significantly in the second half of 2009.
Experts are divided on the future direction of property prices. Some fear that cuts in government spending, and limited availability of mortgage funds, could curb price increases. But respected think tank the Centre for Economics and Business Research reckons that prices will nonetheless rise by 4% this year, and continue to increase until 2014. That’s because of fundamentals, such as lower mortgage interest rates and the scarcity of new property.
The availability of deals at record low rates means that homeowners who have watched their own properties gain in value over the years may have a golden opportunity to remortgage – in order to extend their homes or consolidate other debts, for example.
Tags: Housing Market, Industry
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