Average UK house prices climbed by 51.8% over the past decade but when adjusted for inflation this rate of growth falls to just 12.1%, latest analysis from Yopa reveals.
The analysis comes from Yopa’s Housing Market Affordability Review of the last decade which looks at the UK housing market over the last decade; how the cost of homeownership has changed; how this has impacted affordability for buyers when taking earnings into account and just what costs attribute to the high cost of moving home.
The first release from Yopa’s Housing Market Affordability Review of the last decade looks at house price growth across each segment of the market and how the cost of securing homeownership has changed when adjusting for inflation.
The research shows that, over the last decade, the average UK house price has increased by 51.8%, up from £176,561 in December 2014, to £268,087 in December 2024.
INFLATION HEADACHE
However, after adjusting for inflation, the figures from Yopa show that this rate of growth actually sits at just 12.1%, so whilst the value of a home has increased, the rate of growth isn’t quite as eye-watering as topline house price statistics would suggest.
The research from Yopa also shows that the increase in the value of a first home has largely remained consistent with the same increase seen across the rest of the market.
FIRST-TIME BUYERS
In the last decade, first-time buyers have seen the price of a first home jump by 50.6%, or 11.2% once adjusting for inflation.
At the same time, the value of homes purchased by former owner occupiers has climbed by 51.7% since 2014, or 12% when adjusting for inflation.
This means that, a decade ago, the average first-time buyer was paying 30.8% less compared to existing homeowners, with this gap increasing to just 31.3% today.
NEW-BUILD BOOST
New-build properties have seen by far the largest boost in value over the last 10 years, with the average price of a new-build increasing by 79% between December 2014 and December 2024. Even after adjusting for inflation, this rate of growth still sits at 33.1%.
In contrast, the average value of an existing property has increased by 51% over the last 10 years, or 12.3% once adjusted for inflation.
As a result, the premium paid for a new-build property versus an existing one has increased from 23.7% to a huge 46.6% since 2014.
SCARY NUMBERS
Verona Frankish (main picture), Chief Executive of Yopa, says: “The topline rate of house price growth seen over the last ten years alone can be pretty scary at first glance, to say the least, with the average value of a home increasing by almost 52% since 2014.
“However, the reality is that this rate of growth is far more palatable when taking inflation into account, although it’s fair to say that the plight of the nation’s homebuyers certainly hasn’t improved when it comes to the affordability of purchasing a property.”
MIND THE GAP
But she adds: “What is interesting is that the gap between the cost of a first home and the rest of the market has remained largely consistent, as the cost of a home across both market segments has increased at almost identical rates.
“The same certainly can’t be said for the new-build sector though, with the value of a new home sky rocketing over the last decade when compared to the increases seen across the rest of the market.”
