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Savills: Average £73k profit for home buyers in last 15 years

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  • 15/02/2019
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Savills: Average £73k profit for home buyers in last 15 years
Homeowners who sold in 2018 having bought their properties within the previous 15 years earned an average profit of £73,127, data from Savills showed.

 

They represented 55 per cent of all sellers in the market last year, according to the Savills research.

Of those who sold in 2018, one in five sellers had owned their property for five years or less and they made an average of £52,622 profit.

The research revealed that more than one in three had owned their property for ten years or less making an average profit of £67,496. Over half had owned their property for 15 years or less, making an average profit of £73,127.

More people bought in 2014 than in any other year, making an average profit of £57,874 and accounted for 5.6% of the market.

However, those who bought immediately prior to the credit crunch only made an average of £2,653 more than the 2014 cohort – despite buying seven years earlier.

People who bought in 2017 made only an average profit of £36,195.

 

North vs south

Those increasing profits were heavily driven by London and the surrounding commuter zone.

Whereas almost 40 per cent of sellers moved within ten years of purchase in the South East, in London it is closer to 35 per cent. A smaller percentage of sellers had moved within five years of purchase in London than in the South East.

Around 40 per cent of people who bought within the last 15 years made more than £100,000 across London and the South, with that reaching 70 per cent of people in the capital itself.

In the North of England that was just six per cent.

Similarly, there was a sharp divide in the number of people who made a loss when selling last year.

Just 4 per cent of vendors across London and the South who bought within the last 15 years made a loss by selling in 2018.

That grew to 19 per cent across the North of England and soared to 31 per cent in the North East.

In Middlesbrough, for example, the average profit was just £1,687, while in Kensingston and Chelsea the average profit was £576,187.

Outside London, the biggest gains were made in St Albans where the profit was £198,733.

 

Five-year forecasts for prime rental values across London

Savills also released its prime London rentals index which found early signs of rental values in London’s prime residential markets bottoming out as the annual rate of falls was at its slowest since the June 2016 Brexit vote.

Rents have fallen by an average 9.6 per cent across the capital’s prime markets since the referendum, but falls slowed to just 0.8 per cent in 2018, according to the firm’s index.

Savills forecasts that rents will rise by an average of 11.5 per cent over the next five years, and by 12.6 per cent across the prime commuter zone.

In London, falls have been concentrated in the high value prime central postcodes where rents have fallen by 16.5 per cent since the referendum, slipping a further 3.2 per cent in the past year.

Rents in lower value outer prime London markets are down an average 6.4 per cent in total in the same period, but stabilised by rising 0.2% in 2018.

Price sensitivity in the market is a major factor, with cheaper properties significantly outperforming more expensive ones, the estate agent found.

Properties renting for up to £500 per week have seen five-year price growth of 6.6 per cent, compared to 19.5 per cent falls for those at over £3,000 per week.

 

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