Home values soar by £70,000 in past decade - Mortgages - News - Moneyfacts


Moneyfacts.co.uk News brings you the latest financial & economic news & reviews of the best products in the UK by our team of money experts.

Home values soar by £70,000 in past decade

Home values soar by £70,000 in past decade

Category: Mortgages

Updated: 13/02/2012
First Published: 13/02/2012

This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

The value of a home in the UK has increased by around £70,000 over the past decade and grown at more than double the rate of inflation, new research has revealed.

According to figures compiled by Halifax, the value of the UK 's private housing stock stood at £3.9 trillion at the end of 2011, some £1.8 trillion, or 84% higher, than in 2001.

Over the same period, overall consumer prices, as measured by the retail price index, have increased by just 38%.

The survey says the increase of £1.8 trillion over the decade is equivalent to £68,500 per household in the owner-occupied and private rented sectors in the UK .

But whilst the value of housing stock has soared during the past decade, the figures mask a significant change in fortunes which has been apparent since 2007.

Indeed, over the past five years the value of the UK 's housing stock has declined by 5%, or £187 billion, reflecting the reduction in house prices seen since autumn 2007.

The recent disappointments are, however, more than compensated for by the significant increases seen in the five years prior to 2007.

At the same time that the value of housing stock has risen, so too has the total value of outstanding mortgage balances, more than doubling over the past decade.

However, with the £1.8 trillion increase in the value of housing assets outstripping the £655 billion rise in mortgage debt between 2001 and 2011, housing equity has increased from £1.5 trillion to £2.6 trillion.

"The value of UK's housing stock has soared in the decade to 2011 notwithstanding the decline in house prices seen since autumn 2007, rising by 84% to just under £4 trillion at the end of 2011," said Martin Ellis, housing economist at Halifax.

"Whilst outstanding mortgage debt has more than doubled over the last ten years, the value of the housing stock has risen by more in monetary terms.

"As a result, the total value of housing equity has shown a healthy increase.

"For most homeowners housing is still very much the main store of private wealth."

Find the best mortgage rate - Compare best selling mortgages

Disclaimer: Information is correct as of the date of publication (shown at the top of this article). Any products featured may be withdrawn by their provider or changed at any time.

Related Articles

Homeowners underestimate remortgaging savings

Remortgaging has been enjoying a surge in popularity in recent months, and considering how much you could save, it’s a no-brainer! Unfortunately, many fail to realise the extent of potential savings, which could mean too few make the switch.

Mortgage rates at fresh lows – but it may not last

Average fixed mortgage rates continued to fall this month, however much of this could be a technical adjustment rather than an indication of ongoing rate cuts – which means it may be worth switching to a new fixed rate deal sooner rather than later.

10-year fixed mortgage market flourishes

Given upcoming negotiations on the UK’s relationship with the EU, we are expected to have some uncertain times ahead. As a result, many borrowers will be seeking long-term mortgage repayment security, and happily, the 10-year market is flourishing.