Detached properties have increased in value by more than £100,000 over the last five years and in the last 12 months have seen annual growth of +4.1% to £471,748.
Northern Ireland recorded the strongest annual growth in detached house prices, at +15.2% (up £35,857), while London had the weakest at +0.9%, though it still has the most expensive detached properties in the UK (£944,526). This is around five times more than the cheapest in the North East (£190,757).
Flats see slower price growth
By contrast, flats saw the slowest growth in price (+3.2%) with an average price of £168,569.
The UK’s largest lender found that terraced houses led annual growth at +4.5%, reaching £235,296, while semi-detached houses rose by +3.8%, averaging £307,685.
Overall UK property prices rose by +3.7% (£10,431) over the last year to £294,818.
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Amanda Bryden, head of Halifax Mortgages, said: “The fortunes of different property types tend to ebb and flow depending on broader market conditions. This time last year, the average price of a flat had risen more quickly than a detached house, as buyers adjusted to higher borrowing costs and sought to compensate by targeting smaller properties.
“Now, as interest rates have started to ease, it’s once again those homes offering more space which are fuelling demand. And that’s not just a short-term trend; over the last decade, bigger properties have tended to outperform smaller homes when it comes to price growth.
“This has caused the gap between the rungs on the housing ladder to widen further, presenting a bigger challenge to those looking to make the step up. However, that only tells part of the story. Slower growth among smaller homes is helpful for first-time buyers, and we saw a big rebound in that market last year, with a fifth more stepping onto the ladder.”
Toby Leek, president of NAEA Propertymark, added: “Not only are buyers looking to take advantage of easing interest rates to secure a bigger home, but other trends, such as a continued increase in people looking for parking spaces and electric vehicle charging, as well as the surge in desire for outside space post-pandemic are pushing more buyers to pursue larger properties with driveways and gardens, moving away from apartments and flats.
“Terraced homes are likely proving popular amongst buyers as they often offer a home with a larger garden and parking at a more affordable price allowing many to maintain a sustainable financial balance.
“As different areas across the country offer more value for money, it’s likely we will continue to see buyers adjusting their criteria and broadening their search areas.”
First-time buyer numbers rebound
The first-time buyer market rebounded last year, as a fifth more stepped onto the ladder, said Halifax. Improved mortgage affordability saw larger properties experience the strongest price growth within the first-time buyer sector, with terraced homes rising by +3.5%, semi-detached houses by +2.9%, and detached properties by +2.8%. Flats lagged behind at +1.8%.
Flats account for around 27% of first-time buyer purchases in the UK, varying significantly by region, from 71% in London to just 4% in the East Midlands.
