Recent research from estate agents Savills has placed the official exclamation mark to the end of claims that housing has reached an affordability ceiling point as housing stock reached record levels.
Despite the political landscape causing such uncertainty, housing stock ended 2018 at a combined value of over £7.29 trillion.
Whilst property prices started declining in the second half of last year, the price of residential property increased by £190.3 billion.
Although London property values equate to around £1.77 trillion or 25% of the UK’s total, property prices in the capital declined by £26.2 billion. This is the first time London has experienced a decrease since 2009 and may highlight the property market’s difficulties in the current climate.
The governmental push to produce 300,000 new homes seems to be reaping rewards according to Savills’ figures as 28% of the UK’s housing stock total has been attributed to new homes built in 2018.
Overall, this means that £52.6 billion worth of property was built last year. Although this may still fall below the needed housing stock, it certainly indicates that more houses than ever are being built; the last time there was more new property being built was in 2011.
The findings suggest the average property increased in value by £4,800. In total, £133.7 billion or 72% of the increased value of housing stock was caused by increases in property prices in 2018.
Lawrence Bowles, residential research analyst at Savills, said: “Our analysis demonstrates the scale of the housing market and underlines the importance of housing to the economies of London and the UK as a whole, both as an asset class and store of private wealth,’ said Lawrence Bowles, residential research analyst at Savills.
“As affordability becomes more stretched, younger households are having to put off buying their first home until later in life.”
Do these figures indicate that the market is more buoyant than experts predicted? Will this make it more difficult for first-time buyers to afford property?