House prices may be down, but don't count them out
- Despite the property downturn, bricks and mortar remain safest bet for your money -
House prices may be falling, but the good news for UK homeowners is that it could have been a lot worse had they put their money in the stock market instead. New figures released today show that the FTSE 100 Index has tumbled at twice the pace of UK property prices, falling 35 per cent in the last 12 months whilst average house prices have fallen 17 per cent over the same period.
Research by Zoopla.co.uk, the UK's leading property information website, reveals that the returns in the UK property market have not only outperformed the stock market in the short term but have also held up better over a three, five, ten and even 20 year period. The starkest contrast being an investor who had put £87,824 (average UK house price in March 1999) into the property market ten years ago and would have made over £110,000 profit on that investment despite the recent fall in house prices, versus someone who had invested the same amount in shares at the height of the stock market bubble and would have seen over £33,000 wiped off their investment.
Alex Chesterman, founder and CEO of Zoopla.co.uk, commented:
"There hasn't been much to cheer about with all the doom and gloom in the housing market of late and homeowners are clearly concerned about the recent fall in home values, but for those looking to upgrade or who aren't in a hurry to sell in this market, property continues to be a great long term investment. Over the past 20 years despite the property market ups and downs and stock market booms and busts, housing has performed 50 per cent better than share prices. For those on the sidelines with cash, our research indicates that property remains the best bet to provide a healthy long term return. And for anyone interested in the UK property market, Zoopla.co.uk is the ultimate resource providing access to properties for sale, house prices paid, current value estimates, local trends and much more."
UK House Prices vs. FTSE 100 Comparison Table
Date | Avg. house price | FTSE 100 |
|---|---|---|
Mar 1st 2009 | £198,522 | 3830.1 |
Mar 2008 (1 yr) | £238,959 (down 16.9%) | 5884.3 (down 34.9%) |
Mar 2006 (3 yr) | £212,234 (down 6.5%) | 5791.5 (down 33.9%) |
Mar 2004 (5 yr) | £181,601 (up 9.3%) | 4492.2 (down 14.7%) |
Mar 1999 (10 yr) | £87,824 (up 126.1%) | 6177.5 (down 38%) |
Mar 1994 (15 yr) | £72,994 (up 172%) | 3322.9 (up 15.3%) |
Mar 1989 (20 yr) | £82,297 (up 141.2%) | 2017.9 (up 89.9%) |
Source: Zoopla.co.uk
- Ends -
About Zoopla
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We know you're not just looking for a place to live. You're looking for a home.
Yeah, we've got over a million properties for you to browse.
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But we know you're looking for more than that.
Because that first flat won't just be a 'great investment opportunity'.
It'll be the feeling of starting out on your own.
That extra bedroom won't just mean another £20K on the re-sale price, it'll mean having your sister over to stay.
And that bungalow won't just be a way to release some equity, it will be a chance to spend more time with the grandkids.
We know that searching for a home is about more than just checking its price, location and features (important as all those things are).
What really matters is how it makes you feel.
We know what a home is really worth.
So let us help you find yours.
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