The number of places in Britain where it is possible to buy a property for less than £150,000 has dropped by 28 per cent, according to new research. 

Savills states that the areas available to buyers who have such low budgets has decreased significantly over this pandemic.

This is despite the fact that house prices have soared during the pandemic, as housebuyers reevaluate their housing requirements.

This four-bedroom house is in Great Yarmouth and is for sale for £150,000 via estate agents William H Brown

This four-bedroom house is in Great Yarmouth and is for sale for £150,000 via estate agents William H Brown

The estate agent used data from the Land Registry to determine the average value of wards in Britain.

A ward refers to a division of a local government used for electoral purposes. The United Kingdom has 8,694 electoral districts, and England has 7,026.

It found that in the year to September last year, only 10 per cent of these total wards had an average house price below £150,000. 

Based on 873 of 8,694 total wards, where at least 10 were sold in the past year.  

There are only five wards left in South England, compared to 17 the previous year. All five of these wards are located in Great Yarmouth East Suffolk and Cambridgeshire’s Fenland. 

London, South East and South West were not considered qualifying.

In the North East of England, the proportion of wards where the average house price is below £150,000 has fallen below 50 per cent for the first time. But, at 48% it is the highest in any region.

The 28 per cent drop in wards with an average house price below £150,000 is based on the year to March 2020 compared to the year to September 2021.

Savills explained that this research was based on the sales data over 12 months because there were not enough transactions to obtain a reliable average.

This three-bedroom semi-detached house in March - part of the Fens - is for sale for £150,000 via estate agents William H Brown

This three-bedroom semi-detached house in March – part of the Fens – is for sale for £150,000 via estate agents William H Brown

At the end of the scale, the number of wards where average values are more than £500,000 is up 38 per cent, from 889 to 1,224 compared to the 12 months to the end of March 2020.

This included a 19 per cent increase in London where the average sale price was more than £500,000 in 63 per cent of its 635 local markets.

Outside of London, the number of wards with an average sale price of more £500k increased by a much greater 48 per cent, with a 34 per cent increase in number across the South East. The average selling price of a property in this region was higher than the benchmark, which means one out three properties exceeded the benchmark.

At the same time, the South West experienced a 146 per cent increase in the number of wards where the average house price exceeded £500,000. These wards accounted for over 10% of the 1,013 in this region.

These areas were particularly popular with those who left urban environments during the pandemic.

Between them, these three counties saw 47 more wards join the £500,000-plus group with strong growth in numbers across the Cotswolds, the Mendips and coastal Devon.

This three-bedroom house in East Suffolk's Lowestoft is on the market for £150,000 via estate agents William H Brown

This three-bedroom house in East Suffolk’s Lowestoft is on the market for £150,000 via estate agents William H Brown

Lucian Cook of Savills said that despite the recent surge in house prices which was fueled by the stamp tax holiday, the continued momentum of the market has been underpinned fundamentally by low interest rates and people’s reassessment about their housing needs.

“In certain parts of the UK this led to a substantial increase in house prices. The most notable growth is usually a reflection of how much more well-off households have altered their locational preferences.

‘But the mini-boom in the housing market also means the range of locations accessible to a household with a more limited budget of £150,000 has shrunk substantially. 

“This will likely come into sharper focus as interest rates begin to climb upwards. 

“With all of this in mind the Bank of England’s future position on mortgage regulation will be key. 

The mini-boom in the housing market also means the range of locations accessible to a household with a more limited budget of £150,000 has shrunk substantially.

“If the policy were to be relaxed, it would allow for more price growth over the medium-term but would reduce its protection against future declines.

House prices rose by 10.4 per cent in the year to December, to an average of £254,822, according to Nationwide Building Society.

According to the mortgage company, the increase means that 2021 will be the best calendar performance since 2006.

Robert Gardner, Nationwide’s chief economist, said: ‘The price of a typical UK home is now at a record high of £254,822, up £23,902 over the year – the largest rise we’ve seen in a single year in cash terms. Now prices are 16% higher than when the pandemic hit in early 2020.

Despite the expiration of stamp duty at September’s end, the demand for goods and services has not fallen in the last few months. 

The mortgage approvals required for home purchase continue to be above the pre-pandemic level, even with the recent surge in activity. 

In fact, the number of real estate transactions in the first eleven months of 2021 was nearly 30% higher than the previous year.

“But, at the same time the stock of houses on the market has remained exceptionally low throughout the year. This has contributed to the strong pace of price increase.”

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