A new analysis by property investment platform easyMoney reveals that detached homes have delivered the best investment returns of all residential property types in the past decade.
Detached houses’ value growth outperformed flats by more than 20 per cent.
To understand what type of residential property makes for the best investment, easyMoney has analysed the annual value change of all types of home - detached, semi-detached, terraced, and flats - over the past decade to see which has increased the most and therefore delivered the best returns for investors.
Over the past 10 years, the average price of detached homes in the UK has increased by 74 per cent or £195,247 to stand at a current price of £459,013. This is the largest value increase of all property types.
Semi-detached homes now cost an average of £280,425 after 10-year price growth of 71.4 per cent or £116,817, while terraced homes now cost £235,529 after increasing in value by 67.6 per cent of £95,024 since 2013.
Meanwhile, UK flats have experienced price growth of 51 per cent or £77,127 in the past decade, and now cost an average of £228,441.
easyMoney chief executive Jason Ferrando says: “This research demonstrates just how secure property investment is in this country.
“Despite all of the economic and global turmoil we have endured in the past decade, negative annual price change has only been recorded twice and in both instances it was flats that lost value, and neither time did the loss surpass 0.7 per cent.
“Flats are, in general, an outlier. While all other property types enjoyed massive price boosts during the pandemic, flats recorded only their third-highest growth of the decade.
”This is because the pandemic and lockdowns instigated a race for space that flats simply cannot satisfy, and also because of the external cladding issues highlighted by the Grenfell tragedy and which continues to haunt high rise buildings to this day.
“Despite this, however, flats have still delivered positive ten-year investment returns proving that even in the worst circumstances, residential property is one of, if not the most reliable investment asset money can buy.”
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I understand what makes a property attractive and having a garden, an outdoor space, to enjoy in good weather is lovely. However, tenants do not wish to look after a garden so you need to build a gardener into the maintenance cost on top of everything else. Tenants expect every tiny little thing to be paid for them and it is really very wearing at times.
V True- AG. Want a garden space outside but not look after it. Even had one tenant whose bck door led on to his private garden and he thought I should look after it he thought was a reward for being a good tenant. Pillock.
This assessment on returns is based on purchase and sales comparison. No indication of returns achieved during ownership via letting. So the true potential is not recognised.
Agree with Rob C. Better to look at all the costs and income from when a property was purchased to time of sale. But who has this information?
You might find it hard to believe that I am selling my portfolio and will re invest it into a plot of land to create a cemetery. I was offered a plot, through my accountant, back in 1991 and I didn't take it. The benefits are, no regulations, no need for EPC Certificate, Gas Safety Certificate, Electric Certificate....And you do not even need HMO Licences. Leases are for thirty years (of course can be renewed by surviving family members. Guaranteed decent tenants with a very small maintenance costs. I recently visited one in Huddersfield. It is called "no religion cemetery". Just a stone with the "tenant's" name, his date of birth and the day that his tenancy started.
perfect
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