The number of £500,000-plus hotspots increased by 50% during the pandemic – rising from 874 wards in 2019 to 1,312 in 2021, according to the latest research from Savills.

As a result, the number of areas where the average house price exceeds £500,000 has surpassed 15% of Great Britain for the first time ever.

The research into the increase in sales across local authorities wards that occurred above £500,000 revealed that the South West saw the largest rise in half a million pound purchases – up 167%. This reflects a surge in house prices across more rural parts of the country.

The number of wards in the traditional lifestyle relocation and downsizer and hotspots Cotswolds, Bath and Somerset increased from 17 to 29, bringing in the likes of Stow and Northleach, Combe Down and the Chew Valley West; whereas markets such as the South Hams and Cornwall saw an increase from four to 11 combined.

Lucian Cook, head of residential research at Savills, said: “The momentum for moving throughout the pandemic – born from a desire for more space, and spurred on by the government’s stamp duty holiday – resulted in a mini-house price boom across the country. But with stock in long-favoured hotspots across the country unable to meet increased demand, surrounding wards benefited, too. As a result, we’ve seen a surge in new geographical areas breaking the half a million pound threshold over the past two years.”

The increase in suburban and semi-suburban locations breaching the £500,000 threshold is most notable in London, with seven wards tipping over the half a million pound threshold in Croydon, and a further eight in Waltham Forest.

Now, almost two-thirds – 63% – of all London areas are seeing an average house price of £500,000 or more, and a quarter of the wards yet to hit the mark in the capital are within £50,000 of that benchmark.

While regions to the North still have the fewest number of half a million pound hotspots – the number in Yorkshire and the Humber has doubled over the past two years – from five to 10 (four located in Harrogate, and one in Ryedale). Savills research also revealed the emergence of the first £500k wards in the North East, with three wards in Ponteland and the ward of Longhorsely joining the list. Meanwhile, Scotland is yet to register its first £500,000 ward.

Source: Savills using Land Registry and Registers of Scotland

Naturally, not all £500,000 homes are equal and vary in size significantly across the country. The largest can be bought in the North East (2,017 sq ft), versus just 869 sq ft in London.

Despite this, the amount of space half a million pounds can buy you has shrunk just 2% over the last five years in London, compared to a decrease of 13% seen in South West, West Midlands and the North West.

At a local level, in Kensington and Chelsea £500,000 actually buys 21% more space than five years ago – albeit it still buys only 495 sq ft –  thanks to negative growth experienced in prime central London over recent years. Whereas buyers in York and Rushcliffe (Notts) will have seen the opposite. In these two areas, the amount of square footage that can be bought for £500,000 has shrunk by 13% to 1,432 sq. ft. and 1,550 sq. ft. respectively.

Cook added: “The recent increase in prices also means the range of options for those with smaller budgets is getting increasingly limited, with even half a million pounds buying you an increasingly shrinking amount of space. This said the four successive rate rises and the rising cost of living are likely to bring more caution over the coming months which will mean that the rate of price growth slows progressively, potentially to low single-digit figures in coming years, which will come as welcome relief to many who are looking to make their next move.”