The average capital gain for these 27 million homes was £19,000, although nearly three million increased in value by more than £50,000.
The total value of UK housing breached the £10 trillion mark in early 2022 and reached £10.5 trillion by the end of 2022. This represents an increase of £700bn over the year, or nearly £80m added to the value of the nation’s housing every hour on average over 2022.
However, Zoopla’s figures show that not everyone’s home gained in value over 2022, with some 2.3 million homes registering a fall. The average loss in value for these properties was £7,300, representing a 2.7% drop. Homeowners in London accounted for over a quarter (26%) of properties registering a decline in 2022.
Unsurprisingly, with market conditions changing towards the end of the year due to increased economic turbulence, the number of homes with reductions in value started to increase – nearly 16 million properties lost an average of £3,900 in value in the final quarter of 2022.
Looking at price gains achieved over the first two years of the pandemic to February 2022, and then how values have performed in the last six months, Zoopla data shows one million homes have lost all their pandemic gains. Nearly half of these are homes in parts of London and Scotland, where home values did not increase as fast over the pandemic as in other areas of the UK – 20% of homes in East Central London, 14% in West London and 14% in Aberdeenshire lost all paper gains.
The average reduction between June and December was £8,400 in London and £5,200 in the South East. In both these areas, however, more homes increased in value than fell, showing how the trends in home values are highly localised.
Commenting on the analysis, Richard Donnell, executive director at Zoopla, said: “UK homeowners made record gains in the value of their homes over the pandemic years as the nation re-evaluated what we wanted from our homes. These gains have started to be eroded in the final half of 2022 as buyer demand weakened in the face of higher mortgage rates and weaker growth in household incomes.
“The profile of gains and losses varies right across the country, knocking any notion of a single market that moves in unison across the country. Housing markets vary by geography and price band. While the headlines might talk of UK house price falls in 2023, each home will have its own trajectory.”