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House prices surge in prosperous areas

Jamie Grierson,Pa
Monday 20 June 2011 10:10 BST
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(PA)

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The value of homes in the most economically prosperous UK locations - including Cornwall, the Isles of Scilly, Bournemouth and Poole - surged ahead of properties in the country's poorest areas, a survey showed.

Homeowners in the 10 Areas with highest growth rates in economic activity per person, including the aforementioned areas, saw the value of their property nearly quadruple between 1998 and 2008, the Halifax said.

The average house price in the 10 most prosperous areas rose by 219% over the period to £214,162, while the average price in the 10 least prosperous regions rose by 195% to £165,430.

Suren Thiru, housing economist at Halifax, said: "Unsurprisingly, house price growth over the past decade has been stronger in the areas that have seen the biggest increases in economic activity.

"The North-South divide that has opened up recently with the general outperformance of the housing market in southern England appears to reflect the stronger economic performance of these regions."

The average house price in the 10 areas with the highest levels of economic activity in 2008 is 61% higher than the average in the 10 locations with the lowest levels of activity, the survey found.

Furthermore, the survey found that house prices have fared better in the most economically resilient locations since 2008 during the market downturn.

House prices have fallen on average by 24%, Halifax said, in the 10 areas with the biggest falls in economic activity since 2008.

This is almost double the average 13% decline in house prices in the 10 areas that recorded the smallest falls in economic activity since 2008 - including Cornwall and the Isles of Scilly, and Dorset.

Seven of the 10 local areas that have seen the smallest falls in economic activity over the last three years are in southern England but all 10 locations that have recorded the largest falls in economic activity are in the northern regions of the UK.

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