Do you live in a star, a stag, a leader or lagger?
Isabelle Fraser analyses where prices have surged and areas which have been left behind for the last 20 years
We are in a unique housing market: never before has the acceleration of house prices at the top of the scale left so many so far behind. Prices in Hackney, east London, for example, have increased by a staggering 939 per cent between 1995 and 2015. Compare that to Blackpool, where that number is 100 per cent.
Lucian Cook, director of residential research at Savills, says this is unprecedented. “Some of these leading markets in London are pulling away far more than they have ever done before, and the ripple effect has taken much longer to gain strength. That means there is a big price gap between London and the markets farther afield, which have historically moved closely in line with the capital.”
This is the first time that Savills has carried out research on the past 20 years of the housing market in such geographical detail. It identifies which areas are star performers, leading the market, lagging behind, or stagnating. It also illustrates just how diverse the property market really is.
A housing cycle can be defined as one that starts with price rises and ends with the last areas seeing a slowdown or downturn. The stars of the housing market have consistently performed strongly in the past 20 years, irrespective of the point in the cycle; leaders showed the strongest growth in the first half of the cycle, bounced back quickly after the 2007-08 downturn, and brought similar markets with them as the ripple effect spread.
Lagging markets, typically in the North, the Midlands and Wales, have been slower to react, and so see price growth later in the cycle, as long as the underlying economic conditions are right. Stagnant ones have barely reacted at all in 20 years.
Will these lagging markets catch up? “It really depends on what the economic conditions are like when they normally reach that part of the cycle, such as interest rates and mortgage restrictions,” says Cook.
Shining: a Grade II listed house in Bitton, between Bristol and Bath, is on the market for £1.95 million with Savills, above; Steve and Alison Vinning, who are selling their home in Clifton, Bristol for £675,000 with Chappell & Matthews, right