House Prices
UK average house price, 1991-2008
This graph highlights the sharp rise in the average house price in the UK (based on a representative sample of homes) from 1991–2009.
In 1991 the average UK house price was about £62,000. This rose to a peak of around £228,000 in autumn 2008, representing a 267% increase, before dropping to about £226,000 in 2009.
The housing market made a slow recovery from the recession in the early 1990s that was followed by a major housing boom starting in 2000. Despite the onset of the recession, house prices continued to rise, albeit only slightly at 2% from 2007 to 2008, before dropping only slightly in 2009 by 0.7%.
House prices remain high in spite of the recession, resulting in continued housing affordability issues for people on low and middle incomes.
Source: Regional Trends, 2009: Table 47a
Average house prices by country (adjusted for mix of housing types)
This graph shows the average house price (based on annual CLG March figures adjusted for the mix of housing types) for the four countries in the UK.
It is important to note that the mix of housing types was assessed at the beginning of each calendar year to work out the mix-adjustment weightings. Strictly speaking, they are not directly comparable between calendar years. However, they provide a broad understanding of house price trends. House prices can be used as an indicator of affordability as well as providing an understanding of a home’s long-term value as a financial asset.
Between 2002 and 2008, the three countries in Great Britain all experienced house price inflation. The most significant rise was found in Scotland where house prices rose from £118,927 to £163,687 (a 37.6% increase), which is much higher than the level of increase in England (16.3%, from £193,190 to £224,668) and Wales (16.5%, from £142,923 to £166,484). Following the onset of the recession in 2008, house prices in Great Britain dropped from these high levels before slightly recovering in 2010 to reach an average house price of £212,266 in England, £150,648 in Wales and £165,106 in Scotland.
Northern Ireland saw a slightly different trend. Following a short span of rapid house price inflation between 2004 and 2007, house prices started to fall in 2007, a year ahead of the rest of the UK. Between 2002 and 2007, house prices in Northern Ireland were more or less stagnant, with a slight rise from £124,223 to £217,579. Prices then began to decline again, reaching £174,172 in 2010.
Source: CLG, 2010
Average house prices by types of buyer in the UK (adjusted for mix of housing types)
This graph shows the average house prices by types of buyer in the UK (based on annual March figures and adjusted for the mix of housing types).
It is important to note that the mix of housing types was assessed at the beginning of each calendar year to work out the mix-adjustment weightings. Strictly speaking, they are not directly comparable between calendar years. However, they provide a broad understanding of house price trends. House prices by buyer types illustrate the different affordability patterns of those who have already owned their properties outright and those who have just entered the housing market.
Between 2002 and 2010 the percentage increase in average house price has been relatively similar for both first-time buyers (a 54.2% increase) and former owner-occupiers (a 60% increase). In 2002 the difference between the absolute average house prices for former owner-occupiers and first-time buyers stood at £50,746 compared to a difference of £87,045 in 2010.
Average house prices for first-time buyers rose from a lower level of £98,412 in 2002 to a much higher price of £161,250 in 2008 before declining to £151,749 in 2010. Average prices for properties owned outright by former owner-occupiers rose from £149,158 in 2002 to a high of £250,630 in 2008 before declining to £238,794 in 2010.
Source: CLG, 2010