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Residential buy-to-Let

Value of UK housing stock climbs to record high

Author: Gemma

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If further proof were needed of the value of the property market in the UK, recent figures have shown that the country’s housing stock is now worth £7.29 trillion – a record high.

That figure is the equivalent of 3.6 times UK gross domestic product in the 12 months to September last year, while gains from the housing sector are higher than the £187 billion collected by the government in income tax in the year to November 2018.

Savills revealed the sum of £7.29 trillion was achieved following an increase of £190 billion in 2018.

The real estate service provider’s research also highlighted some interesting regional trends, with locations outside London “taking centre stage” in the recent growth. This reverses a pattern that had previously persisted for ten years.

Wales witnessed the biggest gains of all in percentage terms, with the value of its housing stock increasing by 6.3 per cent to £226.1 billion, closely followed by the East Midlands (6.2 per cent) and West Midlands (6.1 per cent).

In absolute terms, the south-east saw the fastest rise, with £29.9 billion of value added to the market.

London, meanwhile, experienced its first drop since 2009. The 1.5 per cent fall was attributed to “stretched affordability and broader economic uncertainty”.

Nearly three-quarters (72 per cent) of total housing stock gains across the UK as a whole came from price appreciation – the equivalent of £4,800 per home – while the rest came from new property development, which made its biggest contribution ever.

The private rented sector witnessed a faster increase in value than all other tenures – a 4.1 per cent jump that took the market past £1.5 trillion for the first time.

Analysing one of the key trends in the research, Lawrence Bowles, associate director of residential research at Savills, said: “It’s great that we’re seeing more housing delivery, but development will have to make up a much higher proportion of new housing value if we are to come anywhere near building the homes this country needs.”

About Experience Invest

You can read the latest UK property investment news on the Experience Invest Blog. As a leading UK property consultancy, the experts at Experience Invest are regularly asked to provide commentary on market trends. You can read the latest Experience Invest research on the FT Adviser.

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