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Saturday 06th of February 2010
January 20, 2010    

House prices rise 237% (over half a century)

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by Gill Montia

Halifax has been looking back over the past 50 years to find that the average cost of a UK home has increased by 237% (in real terms) since 1959.

The typical yearly rate of return of 2.7% exceeded the average rise in real earnings over the period, although house prices recorded their biggest increase in the 2000s when they put on 62%, marginally ahead of the 61% increase in the 1980s.

The worst performing decade for UK house prices was the 1990s when prices fell by 22% in real terms; however, over the past 40 years all regions of the UK have experienced house price increases ahead of average earnings.

Greater London saw the biggest real rise, at 229% and Scotland recorded the smallest, with a real rise of 120%.

Since 1961, owner-occupation in the UK has increased from 43% to 68% in 2008, with the biggest shift occurring in the 1980s, following the introduction of the Right to Buy scheme.

During the same period, the proportion of privately rented homes fell significantly from 33% to 14%, the private rental sector having been bigger than both the owner-occupied and social rented sectors until the mid 1950s.

Finally, between 1960 and 1996 there were dramatic improvement in the quality of housing, with households lacking an inside WC falling from 14% to just 0.2%.

In addition, households without a basic hot water supply declined from 22% in 1967 to 1% in 1991 and the proportion of households benefiting from central heading increased from 35% in 1971 to 92% in 2000.

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