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Who wouldn't want to live within walking distance of a supermarket? While having all those goodies within easy reach may not be the best for your waistline, living near a supermarket is certainly beneficial for property values. Indeed, the right supermarket could net over £36,000 extra!
New research from Lloyds Bank has found that a national supermarket in the neighbourhood could add on average £21,512 to house prices, with certain supermarkets creating more value than others. Perhaps unsurprisingly, a Waitrose nearby commands the largest premium, adding a whole £36,480 to the worth of surrounding homes!
Second place goes to Marks & Spencer, whose supermarkets command a £29,992 premium, and Sainsbury's takes third place with £26,081 added to the local property prices. Even discount chains are worthy of a price difference, with Iceland sitting comfortably in fourth place (£22,767).
What's more, the worth of living near a supermarket appears to be increasing: living near a Lidl unfortunately resulted in a house price discount of £4,719 in 2014, but now also commands a premium, of £6,416. Overall, areas close to budget supermarkets have seen a rise in house prices of 11% in the last three years, faster than the increase for all supermarkets (9%) and thereby catching up to their higher priced competitors.
Naturally, there are regional differences in the effect of supermarkets on prices, with the areas of Ponteland in Newcastle and Chiswick in Hounslow commanding the greatest premiums. Here, prices are 104% and 89% higher respectively than in the surrounding areas. In exchange, residents can enjoy a Waitrose, Sainsbury's and Co-op in Ponteland and a Waitrose, Sainsbury's and M&S in Chiswick – super convenient if you can handle the average house price of £393,502 or £940,218!
Of course, it might be that supermarkets are placing themselves in areas where house prices are already more inclined to be higher than the average, and other factors could be in play. Still, a supermarket near your front door could save you a lot in fuel over the years. If that is worth the premium, well, that is for you to decide.
If you're not already living in one of these areas and enjoying the convenience of having a supermarket on your doorstep – as well as the benefits of being able to sell your house at a premium or using it for equity release – what can you do? Well, if you're looking for a more affordable house, avoid the areas around supermarkets to keep the cost down, especially if you spot a Waitrose around.
If you are happy to pay a premium to live near a supermarket chain, then there are a few things you can do to try to keep the costs down. First and foremost, make sure you find the best mortgage rate for your circumstances, and ensure your credit score is good enough for the mortgage provider.
If you are well-prepared and ready to move at the convenience of the seller, then you are more likely to get the house even if you don't have the highest offer. So, do your homework, make sure your deposit is large enough, and get searching. The property of your dreams – and the luxury of convenient grocery shopping – could be closer than you think.
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