Which areas are experiencing an increase in house prices?

With two-thirds of homes experiencing a rise in value over the past year, is it possible that yours is among them?

we track the value of 30 million homes, updating our estimates every month.

Our latest analysis shows that the value of UK housing remains healthier than many may have anticipated.

In the last year, 2 out of every 3 homeowners saw the value of their home increase by at least 1%.

It’s a piece of positive news for many homeowners and sellers, who may have anticipated a different outcome.

However, house prices are now rising at a very slow pace - and some homes are posting small price falls.

Executive Director - Research,  says: ‘Homeowners thinking about moving will be reading the news headlines but national averages can be dangerous when making decisions on your own home. 

‘The reality is that market conditions can vary widely by local area and property type.’ 

Home values hold steady

From February 2020 to June 2022, the average UK home increased in value by an almost unprecedented £48 per day, adding around £36,000 to the overall value on average.

But the last 12 months tell a different story.

The average UK home has since increased by £19 per day, adding around £7,000 on average.

While our latest analysis shows 2 in every 3 homes increased in value by at least 1% over the last year, when looking at the last 6 months, this slows to just 1 in 3.

And falling values are increasing, with 1 in 4 homeowners experiencing a value loss of £7,700 (around 2.6%).

This shows that the impact of weaker demand is now affecting house prices.

Why aren’t house prices rising much any more?

Since the middle of last year, the economic backdrop has become more challenging, impacting housing value growth.

Tripling mortgage rates over the last 18 months and cost-of-living pressures are adding to the squeeze on household budgets, leading to weaker demand for homes.

That means the huge growth in house prices we saw over the pandemic years has now stalled and property prices are rising very slowly.

With anticipated price corrections, we expect more homeowners to see either more limited gains or modest decreases in their home values over the coming months.

Where are homes going up in value in the UK?

The impact of recent value changes will be felt differently across the country.

In northern England, the Midlands and Wales, 4 in 10 homeowners saw the value of their homes grow since November 2022.

Yorkshire and the Humber has four postal areas in the top 10 regions where values are up: Halifax (67%), Wakefield (65%), Huddersfield (59%) and Bradford (52%).

Top 10 regions where house prices are rising

However it’s a different picture in southern England, Scotland and Northern Ireland, where only 1 in 4 homes has increased in value (3.1million).

In London, the South East and Eastern regions, 1 in 5 homes has increased in value.

That’s because property values in the south are higher, often exceeding £300,000, which means people need bigger mortgages to buy them.

With mortgage rates currently high buyers are wary, reducing demand for these more expensive homes.

From the South, only Dorchester makes our top 10, where 46,000 homes have increased in value since November 2022.

And homeowners holding off their next move until they grow more equity are unlikely to see meaningful additions in the coming months.

What types of homes are holding their value?

As cost-of-living pressures intensify, many buyers are looking for more affordable properties.

Smaller homes - terraced houses, semi-detached homes and apartments - are keeping their values better than the more expensive detached houses and bungalows.

But location is key.

Semis in Yorkshire, where 4 in every 5 homes have held or increased their value, are doing better than elsewhere in the UK.

In Scotland, only 50% of semi-detached homes have held or increased their value.

Flats are also holding up more than detached houses or bungalows, especially in the affordable markets that attract value-conscious buyers.

In Darlington, Lincoln and Wolverhampton, only 1 in 14 flats has lost any value.

Terraced homes are also holding their own, with more than 64% holding or gaining value since November 2022, especially in cities like Manchester, Leeds, Birmingham and Bristol.

However, the larger homes which became so popular during the pandemic: spacious detached houses, 4-bed homes and bungalows, are now less appealing to buyers, as they become more value-conscious in the face of rising mortgage rates and cost of living pressures.

And prices are adapting accordingly. More than 43% of detached houses and 42% of bungalows have lost 1% of their value in the last 6 months.

Coastal areas like Brighton, Norfolk and Southend-on-Sea are feeling the pinch, where 7 in 10 bungalows are losing value.

Sellers with bigger homes should be prepared for buyers wanting to negotiate harder on the prices.

That said, given the strong value gains these homes experienced during the pandemic, the growth in equity achieved may soften the impact of price reductions without limiting budgets for the next move.

Conclusion

What’s happening in the UK housing market is quite complex at the moment.

Home values are moving in different directions within different local contexts.

The state of the local economy, facilities in the area and differences in the types of homes available will continue to influence home values.

Key takeaways

• The average UK home has gone up £19 a day in value over the last 12 months, an annual increase of £7,000
• A third (9.2million) of UK homes saw their value increase in the last 6 months
• A further third of homes held their value

by Blackstones

Properties Experiencing Significant Value Decline in June 2023

Introducing our "Value of Housing" report, which meticulously monitors the value fluctuations of 29 million homes across the UK. In the latest update for June 2023, we bring attention to the specific types of properties and locations that have experienced a decline in value.

More than a third of UK homes have lost value in the last 6 months, wiping £85 million from the housing market.

That’s 11.1 million properties that are less expensive than they were last November, each losing an average of £7,700.

But UK homes are split almost equally between those gaining value (32%), those seeing no real change (30%) and those losing value (38%) over the last six months.

So what types of properties are losing the most value? Are detached houses finally better value for money?

And where exactly should you look if you want to get a bargain?

We’ve got all the answers for you, whether you’re looking to buy your first house or your forever home.

After all, we track the value of 29 million homes in the UK - even if they’re not on the market.

So let’s see what type of property you should set your sights on - and which locations - to benefit from the latest shift in the UK housing market.

Which kinds of properties are losing value in June 2023?

The search for space has well and truly dwindled, and more larger homes are losing value than smaller ones in the UK.

Over the last 12 months, buyers have been scaling back their home requirements as the economics of buying a home have become more challenging.

It’s in stark contrast to 2020 to 2022, when extra space became the top need for buyers and high demand for larger properties boosted their value growth.

If you want to upsize from a smaller home, flat or terraced house, your current home should hold its value and you’re more likely to get money off a larger home.

43% of detached houses have fallen more than 1% value

Detached houses are losing value more than any other property type in the UK, with 43% losing at least 1% in the last 6 months.

Detached homes with falling values are most common in the St Albans, Perth and Worcester areas, where they make a 9 in 10 of such homes.

7 in 10 bungalows fall in value in the last 6 months

Bungalows account for 8% of all UK homes and 7 in 10 bungalows have recorded a fall in prices since November 2022.

Coastal areas such as Brighton, Norfolk and Southend-on-Sea are seeing the most hits to bungalow prices.

Homes losing value in the South of England, Northern Ireland and Scotland

In some respects, home values are more about where you want to buy a home, rather than what sort of house you want to live in.

The South of England, Northern Ireland or Scotland have the highest proportions of homes losing value, giving buyers the opportunity to buy at a lower price in these locations.

On the other hand, the most homes are rising in value in Northern England, Wales and the Midlands.

The top 10 locations where homes are losing value

While some regions are faring better than others, there’s a lot of complexity in the current UK housing market.

Home values move in different directions within different local contexts, such as the state of the local economy, local facilities and types of homes.

For example, West Central London is seeing a huge 68% of its homes lose value, with an average fall of £13,000 since November 2022.

One key trend we’re seeing is a fall in property values in coastal locations in the South of England.

67% of properties in Colchester (109,000 homes) have lost value by more than 1% in the last 6 months, while 66% have fallen in value in Canterbury.

Many homes in Norwich and Southend-on-Sea have also lost value - 64% and 62% respectively - while 63% of Brighton properties have lost value since November 2022.

Torquay and Truro in the South West also make the list, with 59% of homes in these areas declining in value over the last 6 months.

Buying a home that’s falling in value: what to think about

Your first thought when you see that home values are falling might be that it’s a good time to buy and get a bargain.

This is true to an extent, but you’ll also need to consider any potential for negative equity, as well as the fact that you’re likely to pay a higher mortgage rate now.

Negative equity unlikely with 5% house price falls this year

Our data suggests that house prices will fall by 5% over the course of 2023.

That means you’re unlikely to move into negative equity if you were to buy today - as long as your loan-to-value ratio is lower than 95%.

However, it’s worth knowing that the years of strong price growth are behind us.

It’s always best to buy your next home based on your personal needs and circumstances, rather than looking to make gains or play the market.

A high fixed rate might be worth a lower property price

Higher mortgage rates might be limiting your move right now, and understandably so.

Our recent analysis showed that buying power is hit by up to 20% with a 6% mortgage rate compared to a 4% one - which is putting a strain on home buyers despite falling house prices.

Our mortgage calculator can help you work out how your monthly repayments are impacted by a higher mortgage rate.

Adrian Anderson from property finance specialists Anderson Harris says a high fixed rate mortgage may be worth it now prices are falling, if you’re sure you can afford it.

“It’s usually better to purchase a property at a lower purchase price with a more expensive mortgage in the short term, than pay a higher price for a property and a cheaper mortgage in the short term.”

Always talk to a specialist mortgage advisor to understand the best option for you.

Look for value-adding potential to buck the trend

One way to offset potential price falls for a home you buy is to consider its value-adding potential.

By renovating a doer-upper, you can buy for a lower price and look to increase your return when you sell.

Key takeaways

• Over the last 6 months, 11.1 million or a third of UK homes have decreased in value by at least 1%
• Larger detached homes and bungalows are more likely to be falling in value than any other property type
• Some coastal areas in the South of England are seeing more than 65% of their homes lose value
• Across UK regions, home values are falling the most in the South of England, Scotland and Northern Ireland
• If you want to buy a home that’s dropping in value, think about the risk of negative equity and the impact of higher mortgage rates

by Blackstones

The future of energy efficient homes

Our homes are the second-highest producers of carbon every year in the UK. New-build developers want to change that. Here's how.

From avoiding single-use plastic to upgrading to an all-electric car, as a nation we’re becoming increasing environmentally conscious – even when considering a house move.

Research continually shows that buyers are prioritising the energy performance of new homes, but what about carbon emissions?

All buildings in the UK are the second highest carbon emissions contributor, with residential properties making up a large proportion of this.

However, the country’s home builders are taking action to produce increasingly ‘green’ homes, powered by less energy to help reduce the UK’s carbon emissions and save household running costs.

Our Watt a Save July 2023 report finds the average new-build property consumes 55% less energy, cutting energy bills by £135 a month and reducing carbon emissions by an impressive 60%.

This is despite new-build homes being larger than older properties.

With 247,000 new-build homes issued with an EPC in the year to 31 March 2023, we can see that last year’s new-build homeowners helped to reduce emissions by a collective 500,000 tonnes, compared to if they had been built to the same standards as the average older property.

Why are new builds better for the environment?

New-builds have long offered a cheaper and more environmentally option for the running of a home.

Improved energy efficiency is embedded from the point of design through to construction, thanks to the use of modern building practices, technologies and materials.

Energy usage and carbon emissions: new-builds vs traditional homes

Additionally, more rigorous building standards exist now than ever before.

Last year, changes to building regulations were introduced to set standards specifically related to the energy performance of buildings.

Our research has found that homes now built to these standards will emit 71% less carbon than the average older property.

And the energy savings and carbon reductions won’t stop there.

In 2025, the Future Homes Standard is due to come into force which will require new homes to reduce carbon emissions by a further 75% to 80% on current building regulations.

This will partly be achieved by moving away from the use of conventional gas boilers to modern heating systems, like heat pumps.

In other words, homes built from 2023 will emit 29% of the amount of carbon of the average existing property, and homes built from 2025 will emit just 10%.

If we assume that housing delivery levels in 2025 are around the same as current levels, under the Future Homes Standard, the changes to new homes will see carbon emissions reduced by a further 270,000 tonnes per year.

What does this mean for home buyers?

In recent years, a high EPC rating has crept up the lists of priorities for prospective buyers – particularly those purchasing their first home.

Amid the cost-of-living pressures and with energy bills still stubbornly high, potential customers are also driven by the running costs of a home.

Research we published earlier this year found that 53% of respondents agree that lower utility bills and running costs would encourage them to buy a new home.

The reduction in carbon emissions that new build homes offer come from consistent improvements to the energy efficiency of homes.

In the year to March 2023, 85% of new-build homes were rated A or B for energy performance, while just 4% of existing properties reached the same standards.

Unsurprisingly, this improved energy performance translates to significantly lower utility bills.

In the year to March 2023, the average older property saw monthly energy bills of around £245, while the average new-build energy costs were £110 – a 55% saving.

And as we move towards greener homes, these savings will only become greater. Under the Future Homes Standard mentioned above, a new-build property will use 12% of the amount of energy compared to an older home.

Despite future new homes being 100% electric – which is a more expensive source of energy than gas – it’s anticipated a new-build property built after 2025 will cost a little less than £900-a-year to power.

This is just 30% of the cost of the average existing property which, using a mix of electricity and gas, will cost £2,945 a year.

What next?

As you might know if you are in the process of applying for a mortgage, the affordability criteria are somewhat inflexible.

So, despite the enormous potential savings of high performing energy and thermal-efficient homes, affordability assessments are based on the same assumptions about monthly utility costs. That needs to change.

We’re trying to encourage lenders to develop mortgage products that offer tangible, financial incentives for home buyers to make environmentally conscious, energy-saving choices. Which will in turn support more people to get on that property ladder and become homeowners.

In the meantime, this year’s new homeowners can enjoy lower energy usage, reduced carbon emissions, cheaper energy bills and less eco-guilt so they can get on with living. Sounds ideal to me.

Key takeaways

• New homes built from 2023 will emit 29% of the amount of carbon of the average existing property
• Homes built from 2025 will emit just 10%
• From 2025, the energy bills for a new-build home are projected to be under £900-a-year, compared to £2,945-a-year for an older home

by Blackstones