Halifax has looked at the key trends and developments in the UK housing market over the past 60 years (1951-2011).
Online PR News – 30-May-2012 – Halifax, Yorkshire – Halifax has looked at the key trends and developments in the UK housing market over the past 60 years (1951-2011). The research has been compiled using data from the Halifax's own extensive housing statistics database. Data has also been sourced from the Office for National Statistics and the Communities and Local Government department. The Halifax House Price Index is the UK's longest running monthly house price series with data covering the whole country from January 1983.
As we approach the Queen’s Diamond Jubilee, new research by Halifax has looked at the key developments in the UK housing market over the past 60 years. The analysis starts a year before the coronation of Queen Elizabeth II at a time when the country was recovering from World War II and some rationing was still in place.
Martin Ellis, housing and mortgage economist at Halifax, said:
"The UK housing market has undergone some extraordinary changes over the last 60 years, reflecting the changing way we live our lives. Today, the typical UK household is very different compared with the 1950s following the substantial growth in home ownership and the shift towards single occupancy households."
"The quality of our homes has improved markedly House prices, however, have become prone to pronounced swings over the past 40 years and the rapid decline in the number of homes being built since the 1950s has contributed to the demand-supply imbalance that has characterised the UK housing market in recent years. This is likely to continue to play an important role in determining the landscape of the UK housing market over the coming years."
UK housing market has become highly cyclical since the 1970s. Notwithstanding the decline in the 1950s, house prices were relatively stable in the 20 years to 1971 with annual growth averaging just below 1% (0.9%). There have since been four periods of rapid real house price growth: 1971-73, 1977-80, 1985-89 and 1998-2007. Each period was succeeded by a substantial drop in real house prices.
House prices have been the highest in relation to people's earnings over the last ten years. House prices averaged 4.8 as a multiple of gross annual average earnings2 between 2001 and 2011, peaking at the highest level in the past 60 years at 5.8 in 2007. This compared with the average ratio of 3.9 since 1951.
Whilst more than 15 million homes have been built in the UK in the past 60 years, the number of houses built each year has fallen by one-third since 1951, from 201,860 to an estimated 137,000 in 2011. This drop has been driven by a dramatic fall in the volume of public sector housing being built. Housebuilding reached record levels during the 1960s, with a peak of 425,830 units completed in 1968. Private sector completions also reached a record high in 1968 (226,100).
There was an 81% drop in public sector completions between 1951 and 2011. This was in marked contrast to the four-fold increase in private sector completions over the same period. The fall in public sector completions was driven by the significant reduction in local authority house building in the 1980s. The proportion of all completions accounted for by the public sector has dropped significantly from 87% in 1951 to an estimated 24% in 2011.
The homes we live in are getting smaller. There has been a marked reduction in the size of properties constructed during the last 60 years. Homes of less than 50m2 in size (538 square feet) accounted for 9% all homes built in before 1980. This proportion doubles for homes built after 1980 (18%). Consistent with this, 17% of homes built before 1980 were flats, compared with nearly a quarter (23%) after 1980.
There has been a marked shift in the type of properties built in England over the past 60 years. Detached homes represent just 10% of the current English housing stock3 that was constructed between 1945 and 1964. In contrast, detached properties account for more than a third (36%) of the housing stock built after 1980. Semi-detached properties account for the largest proportion (41%) of the English housing stock built between 1945 and 1964, but represent only 15% of homes built after 1980. Flats account for 20% of the housing stock that was built after 1980 compared with 15% of those built between 1945 and 1964.
Home ownership has more than doubled over the past 60 years from 32% of all households in England in 1953 to 66% in 2010-11. The introduction of the Right to Buy scheme in the 1980s was a key driver of the rise, helping to lift owner-occupation from 57% in 1981 to 68% in 1991. However, owner-occupation has been declining steadily in recent years since reaching a peak of 71% in 2003.
The proportion of homes in the privately rented sector has fallen by two-thirds since the 1950s, from 50% in 1953 to 17% in 2010-11. Over the past decade, however, the size of the private rented sector has increased; rising from 10% in 2001 to 17% in 2010-11.
The relative size of the socially rented sector in 2010-11 (17%) was very similar to that in 1953 (18%). This apparent stability conceals the dramatic changes that have taken place in the past 60 years. The proportion of socially rented homes has fallen from a peak of 32% in 1981, largely as a consequence of the sale of council houses under the Right to Buy scheme and the decline in public sector housebuilding.
There has been a pronounced decline in the 'traditional' family unit over the last 60 years. The proportion of households in England occupied by married couples has nearly halved since the 1970s from 70% in 1971 to 40% in 2011. Over the same period, the proportion of single person households in England has risen from 19% in 1971 to 33% in 2011.
The Halifax House Price Index is the UK's longest running monthly house price series with data covering the whole country from January 1983.
Halifax is a banking chain in the United Kingdom and a division of Bank of Scotland, itself a wholly owned subsidiary of Lloyds Banking Group. It is the UK's largest provider of residential mortgages and savings accounts. It is named after the town of Halifax, West Yorkshire where it was founded as a building society in 1853. Its slogan is "A Little Extra Help".