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Has the surge in buy to let caused huge spike in prices of apartments for sale?
Original Author: Graham Norwood
Data from the Halifax suggested that the average price of a flat has increased by £86,474 (£1,029 per month) since property prices were at their lowest in late 2008, prompting some to say the surge of interest in buy to let lies behind the increase.
A typical apartment was £150,749 in the fourth quarter of 2008 and rose to £237,223 at the end of 2015.
The 57 per cent increase in the average price of a flat was significantly higher than the 37 per cent rise not by Halifax for all residential properties over the same period. This means buyers are on average now paying £17,978 more for a flat than for a semi-detached home, leaving only detached properties and bungalows commanding a higher price nationally.
Detached homes recorded the smallest rise – 20 per cent – since the downturn, while terraced and semi-detached houses saw price rises of 38 per cent and 34 per cent respectively since 2008.
A considerable proportion of the national rise in flat values since 2008 is due to the rapid increase in flat prices in London – 62 per cent in total. Flats represent a much higher share of the property market in the capital compared to elsewhere, and this property type and geographical skew may lie behind some of the dramatic rise in apartment prices.
If London is excluded from the figures, then price growth is greatest for terraced homes (up 31 per cent), with semi-detached houses up 29 per cent and then apartments rising 26 per cent.
