London housing stock doubles in value over a decade

11th November 2015

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The value of London housing stock has more than doubled since 2005 to £1.1 trillion, new research reveals.

The study by Halifax shows the value of UK’s private housing stock in August 2015 is estimated at £5.1 trillion. This compares with £3.3 trillion in 2005 – an increase of £1.8 trillion, or 53% over the past decade.

The increase is equivalent to £76,316 per household in the owner-occupied and private rented sectors.

The value of the UK private residential housing stock has grown at a faster rate than consumer prices, with the retail price index up by 35% in the past decade.

In the past year alone, the value of private housing stock grew by £262 billion, as a result of average house price growth of 4%.

Homeowners equity position improves

The value of mortgage debt has also grown, rising by 35% since 2005 from £942 billion to £1.28 trillion.

Nonetheless, the value of the private housing stock has grown by over five times as much as outstanding mortgage debt at £1.8 trillion compared to £334 billion. As a result, housing equity has increased by £1.4 trillion (60%) over the decade from £2.4 trillion in 2005 to £3.8 trillion.

Regionally, there is a wide variation in the level of housing equity, with a higher balance in the south compared to northern areas. The highest is in London where housing equity is estimated at £798 billion, which is equivalent to £305,749 per household. The next largest is South East (£722 billion, £223,197 per household), and the East (£461 billion, £212,263 per household).

Outside southern England, the highest equity levels are in the North West (£283 billion £109,043 per household), West Midlands (£251 billion, £128,703 per household) and Scotland (£241 billion, £124,679 per household).

There has be a strong rise in the value of the private housing stock across all regions, with values more than doubling in London (105%) from £552 billion to £1.1 trillion over the decade. The next largest increases were in Scotland (72% or £136 billion) South East (55%), East (54%) and the South West (36%).

The North-South divide

The value of housing in the north increased by 36% compared to 66% in the south during the last ten years. As a result, the South’s share of total UK housing assets rose from 56% in 2005 to 61% in 2015.

Even within the South the share of private housing wealth in London has grown from 30% to 37% during the period. The total value of private residential housing stock in the capital is fourteen times the level in Northern Ireland – at £83 billion it is the lowest in the UK.

Value of privately owned housing stock in the UK 2005-2015

 Region Year End 2005- £ billion Year End 2014 – £ billion 2015* – £ billion Total % change over the decade
North East 96 116 121 26%
North West 305 375 394 29%
Yorkshire and the Humber 218 282 295 35%
East Midlands 213 262 277 30%
West Midlands 258 321 336 30%
East 354 509 546 54%
London 552 1,080 1,132 105%
South East 612 891 949 55%
South West 339 437 460 36%
Scotland 189 313 325 72%
Wales 136 168 174 28%
Northern Ireland 64 75 83 29%
UK 3,336 4,829 5,091 53%

 

1 thought on “London housing stock doubles in value over a decade”

  1. Caratacus says:

    All that QE had to go somewhere, I suppose :-)

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