ResidentialAug 16 2017

Premier League's property own goal

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Premier League's property own goal

House price growth in a Premier League town marginally trailed the UK since last season (4.55 per cent as opposed to 4.67 percent).

With the Premier League now under way and turning 25 this week, the last 25 years has seen the average UK house price increase by 302 per cent to £220,713.  

Across the 20 teams playing in the top flight this year, the average house price reached £272,447, with the average Premier League property costing £50,000 more than the UK average. 

When looking at this year’s 20 Premier League teams where local house price growth is concerned, it is Manchester United that returns to their former glory with the highest annual growth in the league at 8.58 per cent and an average house price of £262,997.

Burnley struggled to stay up after promotion last year but where house price growth is concerned the Lancashire team are flying high, losing out on the top spot by the smallest of margins with prices having increased 8.57 per cent in the last year.

Despite this, Burnley is home to the most affordable property price in the league at just £77,525.

The north west also takes third place in the league with Manchester City seeing prices climb by 8.08 per cent, Leicester flies the flag for the East Midlands with an increase of 7.76 per cent and newly promoted Brighton performing well as the best team from the south with prices up by 7.12 per cent annually.

Coincidentally, the two teams which opened the footballing season in the Community Shield were also home to the lowest rate of price growth.

A tough year for the London property market means Chelsea and Arsenal are the only two teams to see annual price growth slump below 1 per cent (0.40 per cent), with Newcastle heading straight back down in the third relegation spot (1.39 per cent).

Despite Arsenal seeing the lowest level of price growth in the league, rivals Tottenham have seen prices increase by 4.5 per cent in the last year, handing them the bragging rights off the pitch at least.

But with their temporary move to Wembley this year, it could be a different story at the end of the season, with Brent home of Wembley Stadium, having seen a growth of just 0.90 per cent annually. 

Elsewhere in London, West Ham’s new home at the London Stadium means they’ve enjoyed the second highest rate of growth of all the teams from the capital at 4.11 per cent.

Crystal Palace has also enjoyed better growth than both Chelsea and Arsenal (3.46 per cent), however, Brighton’s promotion revives one of the stranger footballing rivalries and the Seagulls come out on top with prices growing more than double that of Crystal Palace in the last year (7.12 per cent).

Although Man City is home to the cheaper average house price (£161,611), in the Manchester derby United enjoys the higher rate of growth (8.58 per cent to 8.08 per cent) enough to also beats bitter rivals Liverpool where annual growth is at just 3.55 per cent.

Bournemouth and Southampton will face off in the Premier League again this season having drawn in their last encounter. It’s fairly close run where house price growth is concerned, with Bournemouth edging it at 5.26 per cent in the last year to Southampton’s 4.18 per cent.

But despite their fall from footballing grace, it’s Southampton’s traditional rivals Portsmouth, now in English football's third tier, that has enjoyed the best performance in property terms with prices having increased in the south coast town by 7.4 per cent in the last year.

There was no Tyne-Wear derby last season after Newcastle’s relegation to Championship the season before. But despite the Magpies winning promotion back to the top flight, the Black Cats were woeful last season and as a result will be applying their trade in the Championship this coming season. House price growth in the two areas mirrors their respective performances with Newcastle seeing prices creep up by 1.39 per cent whilst Sunderland has seen prices fall by -3.30 per cent in the last year.

Despite their fall to League One, Blackburn is still on top of Premier League rivals Burnley with prices up a huge 11.47 per cent in the last year to Burnley’s 8.75 per cent.

Although a league separates the two in footballing terms, Cardiff out performs Swansea in the Welsh derby for property price growth with prices up 5.80 per cent to Swansea’s 4.46 per cent.

Again, one league currently separates rivals Oxford and Swindon and despite a price tag of £414,659, nearly double that of Swindon (£210,052), Oxford comes out on top in both football and property terms with prices up 6.40 per cent annually to 6.05 per cent in Swindon.

Founder and CEO of eMoov.co.uk, Russell Quirk, said:  “Although it’s unlikely the table will look like this at the end of the season, it does demonstrate that while there are pockets of the UK currently seeing a decline in price growth, there are also areas all over the nation enjoying very healthy increases in values. 

"It is also interesting to see how rival areas are performing differently, particularly those in close proximity to each other.

"Although neighbours, Liverpool and Manchester are seeing different rates of growth, the higher end London clubs have seen prices stall whilst the capital’s peripheral teams are doing well, and Newcastle and Sunderland are seeing opposite fortunes in price growth terms.”

Steve Webb, director of policy at Royal London, said: "While figures for house price growth over a single year tell us little about the suitability of residential property as an investment vehicle, even this one year of data shows the huge variations in growth rates between different parts of the country.

"In some areas money invested in an average house would not even have kept pace with inflation whilst in other areas the growth in value was three or four times inflation.  

"There is nothing wrong with investing in property as an asset class, preferably as part of a diversified portfolio.  But individual savers are taking a big risk if they stake their future on a single asset - the value of their own home."

James Miller, of Glasgow-based IFA Cowley & Miller, agreed.

He said: "Having your eggs all in one basket is not a good idea. What are important are your goals, objectives and time horzions but an investment in property can be useful as a diversifier from the stock market."

stephanie.hawthorne@ft.com