Apartment prices in the UK outpace other property prices
Apartment prices in the UK have outpaced prices of other property types as the average cost of an apartment has risen by £1,251 per month over the past five years, new data shows
Prices of apartments have risen more than that of any other type of property in the UK. New data from Halifax has shown that the average cost of an apartment in the UK has risen by £1,251 per month over the past five years, increasing in value by £75,074 over the period as apartment price rise has outpaced other property types.
According to the data, the value of apartment increased by 48% between 2013 and 2018, whereas the value of terraced houses and detached homes increased by just 42% and 27% respectively.
Surrenden Invest MD, Jonathan Stephens says the sustained level of demand for apartments in regional city centres has shown solid credentials, even in the wake of the Brexit referendum. With dynamic local economies and solid labour markets, regional cities are an enticing prospect for those looking to make capital gains, whether as owner-occupiers or investors. He said that the majority of investors they work with now come to them with a regional city firmly in mind – London has lost its shine as a residential investment prospect as the UK’s other cities are producing better returns.
Halifax’s latest House Price Index shows a monthly rise in home values of 1.5% during May, following a brief wobble in April. The lender flags up the labour market’s performance, along with low interest rates, as two of the reasons behind this.
Halifax Managing Director, Russell Galley said the continuing strength of the labour market is supporting house prices. In the three months to March the number of full-time employees increased by 202,000, the biggest rise in three years. The pay growth is also edging up and consumer price inflation is falling, and as a result the squeeze on real earnings has started to ease. With interest rates still very low, mortgage affordability is at very manageable levels providing a further underpinning to prices.
With the UK population expected to pass 70 million by mid-2029, and urbanisation increasing steadily (from 80.2% in 2006 to 82.84% in 2016, according to Statista), demand for city centre apartments looks likely to remain strong over the years ahead. And with apartment prices increasing at a faster rate than any other kind of accommodation, they are sure to remain the property of choice for investors looking to make the most of their money.