With a total value of £40bn, Halifax calculates that Westminster has the most valuable housing stock in Great Britain. Seven of the ten local authorities (LAs) with the most valuable private housing stocks are in London.
Eden sees strongest rise in housing stock value since 2000
Over the past five years, the value of the housing stock has increased at the sharpest rate in Eden in the North West, up 169 per cent and Easington in the North of England, up 160 per cent. Additionally, three of the top ten increases were in the South West of England – North Cornwall, Penwith and North Devon.
London housing market worth almost £600bn
London's housing stock alone, at £584bn, is worth more than the combined housing stock of Scotland, Wales, Northern Ireland and the North - £520bn. However, London saw the smallest rise in the last five years of any region, with the value of its housing stock rising 53 per cent from £381 billion in 2000.
Housing wealth centred in south of England
55 per cent of the UK's housing wealth is located in the southern regions of England while 33 per cent is located in northern and middle England. Only 12 per cent of the value of the housing stock is located in Wales, Scotland and Northern Ireland, despite accounting for 16 per cent of the UK's population. Southern England has 44 per cent of the UK's population, while northern and middle England accounts for 40 per cent of the total.
North-South wealth gap has narrowed since 2000
Over the past five years the North-South wealth gap has narrowed slightly with the South accounting for 60 per cent of the UK's housing wealth in 2000 versus 55 per cent in 2005. North and middle England accounted for 29 per cent of the value of the housing stock in 2000, while Scotland, Wales and Northern Ireland accounted for 11 per cent of the total.
Household balance sheet in good shape with net equity of £2.4 trillion
The value of the private housing stock (£3.4 trillion) was twice the value of household financial assets (£1.6 trillion) in 2005 and more than three and a half times outstanding mortgage debt of £967bn.
Value of housing stock rises much faster than inflation
The value of the UK residential housing stock has grown much more quickly than overall consumer prices. The underlying retail price index (RPIX) has risen by only 12 per cent over the past five years versus a 73 per cent increase in the value of the housing stock.
The key findings are:
Value of private residential housing by region
* The value of the UK private residential housing stock was £3.4 trillion at the end of 2005, up an estimated 6 per cent for the year. Since 2000, the value of UK housing has risen 73 per cent from £2 trillion, while over the past ten years it has trebled from £1.1 trillion in 1995 to £3.4 trillion today.
* In the last five years, the North of England has seen the greatest rise in the value of its housing stock (139 per cent) from £47 billion in 2000 to £113 billion in 2005. The North is followed by Yorkshire and the Humber with a 117 per cent increase in the value of its private housing stock, Wales (106 per cent) and the North West (102 per cent).
* In 2005, Northern Ireland saw the value of its housing stock rise by 18 per cent from £61 billion to £71 billion, the fastest rise of any part of the UK, while Scotland saw the value of its housing stock rise by 17 per cent from £162 billion to £190 billion. The South West was the only region to see the value of its housing stock fall, down less than 1 per cent, from £338 billion in 2004 to £337 billion in 2005.
Value of residential housing stock by local authority
* The housing stock in inner West London in 2005 was worth £151bn – more than the total value of the housing stock in the North of England (£113bn) and Wales (£146bn). This is despite inner West London measuring only 110 kms2 compared to 8,592 km2 in the North and 20,779 km2 in Wales. (Inner west London comprises the boroughs of Westminster, Kensington & Chelsea, City of London, Camden, Hammersmith & Fulham and Wandsworth.)
* The most valuable private housing stock in Great Britain on a local authority (LA) basis is in Westminster, £40bn, followed by Birmingham (£38bn) and Kensington & Chelsea (£38bn). Seven of the ten LAs with the most valuable private housing stocks are in London.
* The cities of Edinburgh, Leeds and Birmingham each contribute 14 per cent to the value of their region's housing stock. This is the most of any LA in Great Britain.
* Eden in the North West has seen the biggest percentage increase in the value of its private housing stock of any LA in Great Britain since 2000, 169 per cent. Eden is followed by Easington (160 per cent) and Derwentside (156 per cent) in the North, along with North Cornwall (155 per cent) in the South West.
* The City of London has seen the biggest percentage increase in the value of its private housing stock of any LA in England since 1995, 501 per cent. The top four increases are all in London with the others being Tower Hamlets (483 per cent), Hackney (384 per cent) and Islington (373 per cent).
Household balance sheet
* The household balance sheet is in good shape with housing asset values rising faster than debt levels. We estimate that the value of housing assets exceeded the total value of outstanding mortgage balances by £2.4 trillion in 2005. Additionally, the total value of private sector housing assets was equivalent to around 3.5 times the value of housing secured debt last year. Ten years ago the ratio was 2.8 times.
* The value of housing assets increased by £187bn in 2005 versus a £90bn increase in mortgage balances. Housing assets have increased by more than debt levels in each of the past ten years.
* In the past ten years, housing assets have grown by 213 per cent versus growth in outstanding mortgage debt of 148 per cent. Household financial assets have grown by 76 per cent over the period.
* In 2005 the value of the private residential housing stock (£3.4 trillion) was estimated at 2.2 times the value of private holdings of financial assets - shares, deposits and bonds - which totalled an estimated £1.6 trillion. In 2000 the value of the private housing stock (£2.0 trillion) was equal to 1.4 times the value of privately held financial assets (£1.4 trillion).
Tim Crawford, group economist at Halifax, commented:
"The UK housing market increased in value by nearly £200bn in 2005 and is now worth a record £3.4 trillion. Over the past five years the increase has been more than £1 trillion.
"This increase in the value the housing stock highlights that household balance sheets are in good shape. Housing assets are worth three and a half times the value of housing debt and assets have increased by more than debt levels in each of the past ten years. "
