West Midlands property prices going through the roof
A nice detached home for £39,000. Welcome to 1983. Fast forward three decades and the average price for the same home stands at a rather more staggering £287,000.
House price comparison graphic
Latest figures today revealed the picture of the housing market in the West Midlands – and showed the dramatic rise in property prices.
In 1983 the average for the region was £23,000, but by last year it stood at £191,000 according to the Office of National Statistics. Owners of detached homes have seen the biggest growth. In 1983 the West Midlands average was £39,000, but in 2013 this had grown to £287,000.
Semi-detached homes have increased in value from an average of £20,000 to £163,000 while the value of bungalows has risen from £30,000 to £214,000.
Terraced homes have increased at a slower rate, rising from an average £15,000 in 1983 to £134,000 while flats or maisonettes have seen the lowest increase of all.
Those in converted houses have increased in value from £16,000 to £117,000 and purpose-built ones have gone from £15,000 to £109,000 and are down from a peak of £120,000 in 2007.
The figures have been released as property experts revealed that, following a stall during the recession, house prices in the region are set to rise once again as confidence in the economy continues to grow.
The latest figures from the Office for National Statistics show that in January the West Midlands saw an average 5.3 per cent rise to more than £190,000 compared to a 4.3 per cent increase in December and an 0.7 per cent rise a year before.
The West Midlands rise in January was above the UK average of 3.8 per cent.
The Royal Institution of Chartered Surveyors had estimated last year that the region’s house prices would rise by seven per cent during this year, but the current rate of acceleration looks likely to eclipse that.
More new homes are also now being built across the West Midlands with every new home estimated to bring £75,682 into the regional economy and create 1.8 jobs.
Much of the building revival is down to the impact of the Government’s Help to Buy equity loan scheme. Nationally more than 17,000 have been helped to buy new homes since Help to Buy was launched last April and 88 per cent have been first-time buyers who could put down a deposit of as little as five per cent. It has helped housebuilders rebuild their profits and resulted in more new sites being snapped up.
Just this week Birmingham-headquartered Mar City announced multi-million plans to build more than 500 new homes in the Black Country on brownfield sites.
It wants to put up 250 family homes on the site at Hall Green Road, West Bromwich, 150 at Darkhouse Lane, Coseley and 143 at Cranford Street, Smethwick. Morris Homes also unveiled plans for 48 homes to be built on the Waters Edge development next to the Stourbridge Canal at Wordsley.
Nick Berriman, partner at Wolverhampton-based estate agents Berriman Eaton, said: “The market here is very strong at the moment. We are seeing an increase in inquiries across the board and more properties coming on the market. Instructions are 20 per cent up on last year.
“Our agreed sales are up 40 per cent for the first quarter of this year and we are finding buyers for properties that come on the market as quickly as in a couple of weeks – that has not happened for some time.”
Mr Berriman said that far more first-time buyers were now able to secure finance and that was unblocking the housing market.
A further spur to house prices may come from the changes to pensions announced in the Budget earlier this month.
It allows people to use money they have saved for their pensions to buy property to generate a rental income rather than being forced to buy an annuity. Experts predict is could see the price of an average home nationally soar from £251,000 to £325,000 by 2018.
Just last month the National Housing Federation warned that the housing shortage in the West Midlands was reaching ‘critical’ levels because housebuilding was failing to keep up with population growth.
It is concerned that housing is rapidly becoming unaffordable in the West Midlands with the average home now costing nearly nine times the average wage.
The NHF’s West Midlands external affairs manager Gemma Duggan said: “
“We need the local enterprise partnerships to work with local councils, housing associations and others to take a strategic lead on getting more homes built at the right price in the right places, which will help revitalise communities and create jobs.”