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House prices have tripled since the Millennium

The average house price has increased 207% in the UK since the start of the century outstripped by first time buyer homes rising 264%.

Research from Halifax shows average house prices have risen by 207% or £188,798 with homes costing £91,199 at the turn of the century to £279,998 offering equity release buyers the opportunity to access cash in retirement.

First time buyers on the other hand face rising house prices making it harder to get on the property ladder with the cost of their first home increasing 264% from £63,640 twenty years ago to £231,442.

For older home movers wanting to move to the coast the national park, rising property values often means the gap between their current home and the next increases although it is possible to buy a new house with equity release.

Highest rise in Greater London

In Greater London the rise is the highest where individuals need an extra £375,983 or 239% compared to 1999 with average house prices rising from £157,453 to £533,437.

This has impacted on affordability with the house price to earnings ratio increasing from 5.4 at the turn of the millennium to 10.8 times today compared to the national average of 7.5.

The following table from Halifax shows the largest change in house prices in the UK from 1999 to December 2019.
Region Difference 20-year change
Greater London £375,983 239%
East Anglia £190,308 238%
South West £188,766 213%
East Midlands £147,431 212%
South East £254,543 211%
Yorkshire & Humber £130,772 206%
West Midlands £149,175 193%
Wales £125,136 193%
North West £133,713 188%
The largest percentage rise is Newham in London up 429% increasing from £75,762 in 1999 to £400,574 two decades later and for homeowners can use a lifetime mortgage to release cash for a specific reason such as to improve their home.

This compares to second place East Anglia with a difference of £190,308 or 238% where property values in 1999 were only £79,899 rising to £270,206 twenty years later.

Higher property values for older homeowners allows homeowners to access wealth using a lifetime mortgage to repay an interest only mortgage or even buying a dream home in retirement.

You can find out more about the best providers and products for a lifetime mortgage to access cash for your family or buy a dream home with this link:
Free equity release quote of the best providers to buy your dream home.

Russell Galley Managing Director, Halifax said, the rise in house prices in London since the turn of the century and a sharp decrease in affordability just shows how quickly the market has moved.

First time buyers are very important

The cost to get on the property ladder for first time buyers has risen faster than the average UK home up 264% or £167,802 over twenty years.

Leading the rise is Greater London up 284% or £338,536 with a first home costing £457,548 and the smallest gain being Northern rising 160% and Scotland up 212%.

The good news for new buyers is there may be less competition as purchases are less attractive to buy-to-let investors after recent changes to stamp duty tax and taxation allowance on mortgage interest.

Mr Galley said, new buyers are hugely important to the overall health of the UK housing market despite a shortage of homes and the ongoing challenge of raising deposits.

The number of first time buyers is increasing and this is supported by low mortgage rates, the government Help to Buy scheme, shared ownership and family members that can release lump sum cash upfront from their homes.

In terms of purchasing power, London is the most unaffordable region and as an example Hillingdon in West London has seen the house price to earnings ratio increasing from 3.9 twenty years ago to 11.1 today.

What are your next steps?

Talk to our London City Mortgage advisers if you are an older homeowner releasing equity from your property, we can recommend the lifetime mortgage and arrange an application through LCM to access wealth to consolidate debt, home improvements or gifting to a family member.

See the maximum amount you can release with a lifetime mortgage for home improvements or gift to family members using this link:
Free equity release calculator to show the amount you can release from your home.

At LCM our mortgage advisers can find the most cost effective mortgage deal. Learn more by using the equity release calculator, property value tracker chart and mortgage costs calculator.


Mortgage Best Buys

These are examples of mortgage products we can approach with many more offering interest rates and flexibility to meet your needs.

1.19% Fixed Rate
60% Loan to Value
£999 App Fee
2-Years Time
Reverts to 3.59%
1.18% Fixed Rate
60% Loan to Value
£1,034 App Fee
Until 31/10/2022
Reverts to 3.59%
1.17% Fixed Rate
60% Loan to Value
£1,025 App Fee
Until 31/09/2022
Reverts to 3.59%
1.16% Fixed Rate
60% Loan to Value
£1,525 App Fee
Until 01/11/2022
Reverts to 4.09%

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  • IMPORTANT

    Equity Release may involve a Lifetime Mortgage or a Home Reversion Scheme. To understand the features and risks, please ask for a personalised illustration. Equity Release may affect your entitlement to means tested state benefits and will impact on the size of your estate. For Equity Release London City Mortgages charge a fixed fee upon completion of £695. For Mortgages a fixed fee is charged on application. Typically this is from £295 up to £495 for the services selected.

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    Equity Release - Equity Released from your home will be secured against it. Mortgages – Your home may be repossessed if you do not keep up repayments on your mortgage or other loans secured against it. Think carefully before securing other debts against your home. The information contained in this website is subject to the UK regulatory regime and is therefore intended for consumers based in the UK.

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