According to global real estate services provider, Savills, the UK housing value hit a record high of £8.41 trillion in 2021, up 10.6% on 2020.
The UK housing market saw an increase of £804 billion last year, which the estate agent states is the biggest annual increase in value ever recorded. This is the fastest annual percentage growth recorded in the last 15 years and follows a decade of stock value increases which has seen the housing market in the UK rise by over 75.7% (£3.6 trillion).
Continuing trends which have dominated the housing market for some time, London and the South hold 62% of the total value verses only having 44% of all housing stock. Savills findings state: ‘In England, the South East saw the greater increase in housing value in 2021, rising by £155 billion or 10.9%, followed by the North (£131 billion) and London (£130 billion). Scotland, Wales and Northern Ireland grew by a combined £98 billion – +12.5%.’
However, following the pandemic and the work from home culture that has arisen, there has been a demand for suburban locations that offer better value for money than urban areas. This has helped to add value to areas such as the South West and Midlands. Cornwall, for example, saw its value rise by £16.2 billion in 2021. It is also one of the top 10 locations for growth over the last 10 years, one of only two districts outside of London to enter the top 10.
Contributing factors that led to this record high increase include the stamp duty holiday and a low interest rate environment, which encouraged people to move that might not have done so otherwise. This is in addition to the pandemic causing a shift in focus for homeowners, Lawrence Bowles, a director in the Savills residential research team explains.
“People’s lifestyle needs and housing preferences hugely shifted over the course of the pandemic, with many reassessing what they want out of their living environment in response to increased working from home and the need for more inside and outside space.”
With records being broken in 2021, it makes you wonder what 2022 will have in-store for the property industry.