The price of a home in the UK has more than trebled since the turn of the century, new research has revealed.
The average UK price in 1999 was £91,199 and has now risen to £279,997, representing an increase of over 200 per cent. In Scotland, prices have risen by 173 per cent, from £68,959 in 1999 to £187,533.
London and East Anglia jointly saw the biggest increase, at 284 per cent. – while two local authorities within London have seen average house price increases of over 400 per cent since the end of 1999. Property prices in London are by far the highest in the UK now at £338,536. In 2000, the house price to earnings (PE) ratio – which is calculated by taking the average earnings in a region as a proportion of average house prices in that region, – sat at 5.4.
However, by the end of 2019 this has rocketed to 10.8. North of the Border, the PE ratio stands at 5.3.
Over the past 20 years, Scottish house prices for first time buyers have risen by 212 per cent – from £48,683 in 1999 to £151,847 today.
Russell Galley, managing director at Halifax, which carried out the research, said: “The rise in house prices in London since the turn of the century is well documented, and a sharp decrease in affordability just shows how quickly the market has moved.
“Conversely, there are bargains to be had elsewhere such as in the North, Scotland and Northern Ireland where prices have been slightly more subdued and properties compared to earnings are comparatively affordable. A renewed focus on housing policy and increased infrastructure investment aimed outside the South East, for example, may go some way to rebalance the differences.”
He added: “New buyers are hugely important to the overall health of the UK housing market. Despite a shortage of homes and the ongoing challenge of raising deposits, we know that the number of first-time buyers is moving in the right direction.
“Key to this is continued low mortgage rates and a wealth of options available to first-time buyers, helping to support even more step foot on the ladder.”
While every region saw houses, at the very least double, in value, residents in Northern Ireland experienced the least dramatic increase at 139 per cent, or £97,056. Richmond-upon-Thames in London has seen the smallest change in its first home house price to earnings ratio, increasing by just 0.4. However, in 2000, the area was already the most unaffordable according to this measure at 7.2.
By JANE BRADLEY