Halifax press release
Ten years of housing: Winners and losers
Tuesday 26th February 2002
THE SOUTH EAST
The Halifax, the UK's largest mortgage lender, has examined the movement in house prices in 720 towns across the UK over the last 10 years, including 189 towns in the South East. The two tables show the top 20 and the bottom 20 towns in the region in terms of house price changes during the past 10 years. House prices in the South East as a whole have increased by 104% over the past 10 years. Thames Ditton, Surrey tops the league, experiencing the biggest increase in the region as well as the biggest rise in the UK (206%), whilst Polegate, East Sussex has recorded the smallest rise (50%).
Key Findings
- The average house price in the region has risen by more than the UK average of 75% during the last 10 years. Overall, the South East is ranked third out of the 12 economic planning regions in the UK. Prices have only risen more quickly in Greater London and Northern Ireland over the decade.
- More than half of the surveyed towns (104 out of the 189) in the South East have experienced at least a doubling in house prices in the past 10 years, with 10 recording a rise of at least 150% – Thames Ditton, Thame, Hove, Weybridge, Egham, Windsor, Brighton, Buckingham, Tring and Epping (in descending order).
- Five towns in the South East feature in the national top 10 for the last 10 years – Thames Ditton, Thame, Hove, Weybridge and Egham.
- Gerrards Cross is the most expensive town in the region with a current average house price of nearly 378,000, having taken over Esher, which was the most expensive town 10 years ago. Esher is now the second most expensive town in the South East with an average price of 376,000. The two towns are also the most expensive in the country.
- Nineteen towns have an average price in excess of 250,000, more than two and a half times the UK average of 100,000. Six towns have an average price of over 300,000 – Gerrards Cross, Esher, Great Missenden, Thames Ditton, Henley on Thames and Weybridge (in descending order).
- Only eleven of the towns surveyed have an average price below the national average (in descending order) – Westcliff on Sea, Gosport, Ryde, Harwich, Margate, Clacton, South Ockendon, Ramsgate, Sheerness, St Leonards and Dover. Dover is the least expensive town in the South East with an average price of around 90,000; around 10% below the national average.
Julian Roberts, Regional Manager, Halifax Estate Agents, said:
"The strong house price growth referred to over the last 10 years seems to be showing no signs of abating. The start of 2002 has been marked by buoyant demand across all areas with buyers keen to take advantage of very competitive mortgage rates. Investors as well as owner-occupiers are seeing housing as an attractive proposition for capital growth while traditional savings returns remain lower."
Martin Ellis, Halifax Group Economist, commented:
“While house prices in the South East as a whole have risen by 104% during the past 10 years, this masks a huge variation across the region. At one end of the spectrum, house prices in Thames Ditton, Surrey have risen by 206%, the biggest rise in the country in the past 10 years. At the other end of the spectrum, prices in Polegate have increased by a still substantial 50%. The overall increase in house prices in all of the region's towns over the last 10 years demonstrates that residential property is a very good long-term investment, notwithstanding the falls in prices in the early 1990s.”
Winners and Losers in the South East
Top 20 post-towns
| Average Price | 1991 - 2001 | ||||
|---|---|---|---|---|---|
| Post-town | 1991 | 2001 | Increase/Decrease | Increase/Decrease % | UK Ranking (out of 720) |
| Thames Ditton, Surrey | 111,833 | 342,262 | 230,429 | 206 | 1 |
| Thame, Oxon | 87,868 | 249,721 | 161,853 | 184 | 4 |
| Hove | 56,926 | 156,545 | 99,619 | 175 | 7 |
| Weybridge | 119,708 | 329,107 | 209,399 | 175 | 8 |
| Egham | 83,887 | 224,086 | 140,199 | 167 | 10/td> |
| Windsor | 100,421 | 266,766 | 166,345 | 166 | 12 |
| Brighton | 57,993 | 152,823 | 94,830 | 164 | 14 |
| Buckingham | 78,588 | 202,937 | 124,349 | 158 | 16/td> |
| Tring | 88,438 | 228,238 | 139,800 | 158 | 17 |
| Epping | 95,834 | 239,481 | 143,647 | 150 | 20 |
| Marlow | 112,322 | 278,603 | 166,281 | 148 | 21 |
| Chertsey | 89,614 | 219,056 | 129,442 | 144 | 23 |
| Godalming | 112,210 | 272,859 | 160,649 | 143 | 25 |
| Bicester | 63,214 | 151,303 | 88,089 | 139 | 31 |
| Fleet | 94,700 | 223,186 | 128,486 | 136 | 34 |
| Bishops Stortford | 91,011 | 214,479 | 123,468 | 136 | 35 |
| Lewes | 99,095 | 232,796 | 133,701 | 135 | 36 |
| Walton On Thames | 97,401 | 227,515 | 130,114 | 134 | 38 |
| Broxbourne | 99,324 | 231,330 | 132,006 | 133 | 40 |
| Witney | 77,158 | 179,372 | 102,214 | 133 | 41 |
Bottom 20 post-towns
| Average Price | 1991 - 2001 | ||||
|---|---|---|---|---|---|
| Post-town | 1991 | 2001 | Increase/Decrease | Increase/Decrease % | UK Ranking (out of 720) |
| Pulborough | 134,616 | 237,731 | 103,115 | 77 | 340 |
| Welwyn Garden City | 93,299 | 164,704 | 71,405 | 77 | 341 |
| Esher | 214,108 | 376,318 | 162,210 | 76 | 347 |
| Berkhamstead | 138,373 | 241,934 | 103,561 | 75 | 349 |
| Aldershot | 81,907 | 143,192 | 61,285 | 75 | 350 |
| Portsmouth | 61,240 | 106,080 | 44,840 | 73 | 358 |
| Canterbury | 81,637 | 141,026 | 59,389 | 73 | 362 |
| Wickford | 75,108 | 127,961 | 52,853 | 70 | 373 |
| Basildon | 62,865 | 106,725 | 43,860 | 70 | 374 |
| Dover | 52,790 | 89,575 | 36,785 | 70 | 376 |
| Amersham | 159,319 | 269,438 | 110,119 | 69 | 380 |
| Potters Bar | 119,985 | 202,511 | 82,526 | 69 | 383 |
| South Ockendon | 55,952 | 93,847 | 37,895 | 68 | 389 |
| Dorking | 125,785 | 210,362 | 84,577 | 67 | 390 |
| Emsworth | 95,075 | 153,845 | 58,770 | 62 | 420 |
| Ascot | 167,929 | 268,101 | 100,172 | 60 | 430 |
| Swanley | 90,457 | 143,121 | 52,664 | 58 | 437 |
| Maldon | 94,174 | 143,587 | 49,413 | 53 | 470 |
| Uckfield | 105,592 | 160,384 | 54,792 | 52 | 472 |
| Polegate | 83,284 | 124,860 | 41,576 | 50 | 481 |
HOUSING MARKET BACKGROUND – THE LAST TEN YEARS
The UK economy in 1992
Ten years ago the UK economy was in the grips of a recession. Unemployment was increasing sharply, rising to 2.9 million at the end of 1992. Mortgage rates had fallen from their peak of 15.4% in 1990 but, at 10.95% in February 1992, were still almost double their current level.
The UK housing market in 1992
The UK housing market was also in a slump. Nationally, prices fell by 8% in 1992 and transactions totalled only 1.1 million, marking the lowest level of turnover in the market since 1974, and a far cry from the record of 2.1 million in 1988. The number of properties taken into possession had soared from 16,000 in 1989 to 69,000 in 1991 and the number of households with negative equity was climbing significantly, reaching a peak of almost 2 million towards the end of 1992.
The South East housing market over the past 10 years
House prices in the South East were also in decline a decade ago, falling by 12% during 1992. Prices subsequently stabilised and began to pick up markedly from 1996. Overall, prices in the region have risen by 104% in the past 10 years compared with a 75% increase in the UK. The bigger increase in prices in the region has led to a widening in the gap between prices in the South East and the national average. Ten years’ ago the average house price in the region was 16,000 above the UK average, but is currently 48,200 higher.
Housing affordability in the South East
The average house price in the South East currently stands at a multiple of 5.6 times average earnings in the region. This is above the average of 4.9 recorded since 1983 when the Halifax House Price Index began, but remains significantly below the unsustainable 7.5 peak in 1988. Nevertheless, the cut in interest rates over the past year has reduced mortgage payments as a proportion of gross earnings for the average purchaser in the region from 23% to 17% in the last 12 months. Consequently, mortgage payments account for a smaller share of income than at anytime since 1984.
Prospects for the South East in 2002
Low interest rates and unemployment will continue to support housing demand during 2002. The prospect of rising unemployment and higher interest rates later in the year, however, combined with the increasing difficulty that first-time buyers are facing in being able to afford a property in the region, will act as a constraint on the market. Overall, house prices growth in the South East is predicted to slow to around 4% this year, below the UK average of 5%.
