The average property seller in England and Wales who has bought a house in the past 20 years has sold it for Â£ 95,360 more than he paid for the house last year, up from 83,550 Â£ in 2020, according to Hamptons.
Real estate agent says strong growth in house prices since the start of the pandemic has boosted sellers’ earnings, with buyers paying a premium for larger properties as work from home increasingly takes hold. more.
UK house prices rose 9.8% in December 2021 on an annual basis, leaving the UK average house price at a record Â£ 276,091. according to the latest data from Halifax.
Hamptons points out that while the average gross gain to a person selling a detached house was Â£ 151,840, sellers’ flat-rate earnings fell to Â£ 54,690 last year.
He adds that 19% of apartment sellers in 2021 suffered a loss on their property compared to 4% of single-family home sellers.
People’s reassessment of their homes since the onset of Covid-19 has prompted sellers to move earlier. The real estate agent claims that 64% of sellers in 2021 have sold their homes within 10 years, compared to 59% of sellers in 2019.
A record 92% of sellers sold their property in 2021 for more than they bought, having owned it for 8.8 years on average.
The agent estimates sellers in England and Wales made a total gross gain of Â£ 128 billion on property sales last year.
He says: âThe rise in sellers’ profits was stimulated by the sale of larger homes, which have generally been owned longer and therefore benefited from higher price growth. Single-family homeowners accounted for 23% of sellers – and 37% of profits – in England and Wales last year, up from 20% in 2019. â
Apartment owners were the only sellers to see their earnings drop between 2020 and 2021. The average apartment seller who sold in 2021 made a gross gain of Â£ 54,690 or 29%, up from Â£ 62,360 in 2020 .
Meanwhile, the average gain on a terraced property rose to Â£ 79,370, a gain of Â£ 8,820, in 2021 and twin sellers made Â£ 92,430, a gain of Â£ 11,100, on average.
On a regional basis, London sellers continued to achieve the highest absolute gross margin. However, the weaker growth in house prices over the past six years has meant that 2021 marks the first time since 2015, when the agent’s cases began, that the average London seller has made a gain. less than Â£ 200,000.
The average London seller sold his property last year for Â£ 197,730 more than he paid on average 9.1 years ago. This is down from Â£ 207,370 in 2020 and a peak of Â£ 243,050 in 2016.
Northeast sellers were the least likely to turn a profit last year. The average seller in the area made an average gross profit of Â£ 28,960, 22% of whom sold their home for less than they bought it – on average 7.9 years ago.
As a general rule, the longer a person has owned a property, the greater their gain, the agent says. The average 2021 seller who bought 20 years ago has seen their property increase by 180%, compared to 23% for someone who bought five years ago.
They are also less likely to experience a loss, with less than 1% of sellers who bought 20 years ago experiencing a loss on the sale of their home in 2021 compared to 9% of buyers who bought five years ago.
Aneisha Beveridge, head of research at Hamptons, says: âThe strong growth in house prices over the past 18 months has driven up the amount of money homeowners have made.
“But while owners of large properties have benefited from buyers looking for more space, apartment owners have seen lower returns.
“The increases in house prices are mainly due to two factors: the length of time people own their homes and the point at which they have bought in the housing cycle. Typically, homeowners who have owned their property for longer have seen their prices rise more and therefore have made larger profits.
“Although most of these profits are never seen by sellers, as they are reinvested in the housing market on their next purchase.
“Housing price increases last year may have been near their peak. The average 2021 seller bought in 2012, since when house prices in England and Wales have risen 55%.
“However, 2022-2024 sellers are likely to have bought more recently, during a period of weaker price growth. We have seen this before in London, where seller earnings have been declining since 2016.”