Value of UK's private housing stock up £1.8 trillion in a decade - Halifax

Published by Julien Tremblin for 24dash.com in Housing

The value of the UK's private housing stock has risen by £1.8 trillion over the past decade, according to new research.

Figures published by the Halifax, based on data from Communities and Local Government (CLG),  show the total value of domestic property at the end of 2011 stood at £3.9 trillion, up from £2.1 trillion in 2001.  The increase is equivalent to £68,500 for every household in the owner-occupier and private rented sectors.

The picture changes considerably when looking at the value of housing stock since 2007, however. Over the past five years the value of the UK’s housing stock has declined by five percent, or £187 billion, the Halifax research shows. This reflects the reduction in house prices since autumn 2007.

Whilst the value of housing stock has soared during the past decade, so has the total value of outstanding mortgage balances, which have more than doubled (111 percent).

However, housing equity - the value of housing assets less the total value of outstanding mortgage balances - has increased by £1.1 trillion from £1.5 trillion in 2001 to £2.6 trillion in 2011.

According to the Halifax report, the overall value of housing assets in the North has outstripped the South, increasing by 90 percent and 79 percent respectively over the decade.

All 12 regions of the UK have seen a significant increase in the value of their private housing stock during the last 10 years. The biggest increase was in Scotland which saw a 131 percent rise (from £113.5bn in 2001 to £262.6bn in 2011), followed by the North with a rise of 102 percent (from £50.5bn to £101.8bn).

In Yorkshire and the Humber housing value has almost doubled to £236bn from £119bn in 2001 (98 percent).  The smallest increases were in the South East (68 percent) and the West Midlands (71 percent).

Martin Ellis, housing economist at Halifax, said: “The value of UK’s housing stock has soared in the decade to 2011 notwithstanding the decline in house prices seen since autumn 2007, rising by 84 percent to just under £4 trillion at the end of 2011.

"Whilst outstanding mortgage debt has more than doubled over the last ten years, the value of the housing stock has risen by more in monetary terms.

"As a result, the total value of housing equity has shown a healthy increase. For most homeowners housing is still very much the main store of private wealth.”