Savills have recently taken a detailed look at how buyers have fared in the last 15 years, showing how important timing and location can be when purchasing a property.
A little more than half of the homeowners who sold their properties in Wales and England during 2018 had bought their homes in that 15-year period and walked away with a profit of around £73,127 on average. The figures were based on Land Registry findings.
Interestingly, the buyers who invested in 2009, when there was so much uncertainty in the financial markets, benefited from the best profits of around £98,378 on average. However, it should come as no surprise that of the sales in 2018, only 2.5% of them were those who had bought in 2009.
The highest percentage of 2018 sales market, some 5.6%, bought property during 2014. That year was a great year to buy due to the favourable interest rates, strong house price increases and the growth in confidence of the economy.
The people who bought in that year made around £57,874 on average reports Savills, compared to the buyers who invested just before the financial crisis who made only £2,653 more than that, even though they kept their properties for a longer period.
The forecasts for house prices over the next five years indicate there is going to be a reversal in the divide between the North and the South, with the property markets in London and the South being outperformed by the markets in the Midlands and Northern England. However, a noteworthy 19% in the North who bought during that 15 year period and sold during 2018 suffered a loss, compared to only 4% of Southern buyers who made a loss.
On the contrary, 70% of Londoners who sold their homes made over £100,000, but only 6% achieved that in the northern half of the country, with around 31% of North Easterners losing out. The highest profits were made in Chelsea and Kensington, perhaps unsurprisingly, with the average working out at around £576,187. Outside of London it was St Albans where the biggest profits were made, reaching almost £200,000.
Although the data above can be used to an extent, the importance of previous profits on future sales is dependent on the market as it stands and the type of property you are looking to buy and where.
Source: Savills
