The average price of a detached property in the UK hit £486,595 in December 2020, an increase of £43,364 (or 10%) when compared against December 2019 as working from home and the continuing effects of lockdown see house hunters seek more space.
The latest data from Halifax shows that this is by far the biggest boom in the property market in the last 12 months.
This compared with an increase of just £4,533 (3.19%) for flats, which now have an average price tag of £146,717. Terraced houses rose by £11,178 (5.84%) to £202,540, while semi-detached properties became £16,930 more expensive – an increase of 6.26% to £287,313.
Russell Galley, Managing Director, Halifax, said: “As many continue to work from home, this has led to a significant increase in demand for bigger properties, which has likely driven the boost in price we’ve seen in detached homes versus other property types.
“Over the past six months, the average UK house price has risen by 6.3%, making it the market’s best half-year performance since early 2007. While this increase is good news for the market overall, it has further widened the rungs on the housing ladder – particularly for those looking to upsize to a detached property – making the jump more expensive than ever before.
Mind the gap
Flat owners can expect to spend an extra £55,823 to upsize into a typical terraced house, while those currently in a terraced property would need a further £84,774 to own a semi-detached home. But home movers hoping to switch from semi-detached to a detached house need an additional £199,282, making it the toughest housing ladder rung to tackle.
Moreover, record price increases in 2020 have led to house price inflation at the end of 2020 for home movers (+6.4%) being higher than it is for first-time buyers (+4.5%).
Russell added: “While price increases are good news for the market overall, this has impacted home movers looking to upsize, as the gaps between each rung of the housing ladder have widened significantly. Those who have been unable to take a step up the housing ladder in the last year or so may find it harder to trade up than ever before.”
Decades of price hikes
The price of a detached home in the UK has trebled in two decades. In 2000, buyers could secure a typical detached property for an average of £164,827, which jumped to £486,595 in 2020.
However, the last five years have seen the sharpest price increases for those upsizing from semi-detached to a detached home. In 2015, it cost around £148,540 to make the jump, with the gap widening to £199,282 in 2020. Meanwhile, those looking to move from a flat to a terraced home paid an extra £36,939 in 2015, rising to £55,823 last year. Those who moved from a terraced home to a semi-detached property paid £67,281 five years ago, rising to £84,774 last year.