Demand for detached houses in the UK has boomed during the coronavirus pandemic, driving up prices three times faster than for flats as working from home boosted the popularity of bigger homes.
Buyers paid an average price of £486,595 for a detached property in December – 10% more than in December 2019, according to the mortgage lender Halifax.
The 10% increase for detached proprieties far outstrips those seen for othertypes of homes, as a rise in remote working – with a return to offices postponed until the summer – prompts growing numbers of people to move to bigger homes in leafier locations. Home movers had to pay an extra £200,000 to move up from a semi-detached property, which cost an average of £287,313 in December, a rise of as much as 6.3% from a year earlier.
Terrace houses were also in demand, with values rising 5.8% to £202,540. Flats recorded the smallest increase, of 3.2%, to an average price of £146,717.
Over the six months to December, the average UK house price has risen by 6.3%, the fastest growth rate since early 2007, immediately before the 2008 financial crisis, according to Halifax. The price of a detached home has trebled in the last two decades.
Russell Galley, managing director of Halifax, said significant demand for bigger homes was making it tougher for those on the bottom of the property ladder to move to a larger house. :
“The gaps between each rung of the housing ladder have widened significantly. Those who have been unable to take a step up the housing ladder in the last year or so may find it harder to trade up than ever before,” he said.
The housing market slowed at the start of the year amid the third coronavirus lockdown, according to Halifax and surveys from other property industry experts including Nationwide and the Royal Institution of Chartered Surveyors. The government’s stamp duty holiday on property purchases up to £500,000, viewed among key reasons for a boom in house prices last year, is due to expire at the end of March.
Michelle Gallagher, sales director at JDG estate agents in Lancaster, said: “Buyer demand is up, fuelled by the need for more space as more people are having to work from home. For many, homes are shrinking with the kids being home due to home schooling. The problem now is the lack of supply, and as such we’re seeing inflated asking prices on some properties.”