easyMoney: Detached homes yield the best ROI
Detached homes deliver the best return on investment, according to new research from easyMoney.
Of all of the residential property types in the past decade, the value growth of detached homes has outperformed flats by over 20 per cent.
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The peer-to-peer property lending platform analysed the annual value change of all types of home – including detached, semi-detached, terraced, and flats – over the past decade to see which has increased the most, and delivered the best returns for investors.
Over the past decade, the average price of detached homes in the UK has increased by £195,247, around 74 per cent, to stand at a current price of £459,013. This is the largest value increase of all the property types.
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Semi-detached homes now cost an average of £280,425 after 10-year price growth of 71.4 per cent (£116,817), while terraced homes cost £235,529 after increasing in value by 67.6 per cent (£95,024) since 2013.
Meanwhile, UK flats have experienced price growth of 51 per cent (£77,127) in the past decade, and now cost an average of £228,441.
“This research demonstrates just how secure property investment is in this country,” said Jason Ferrando, chief executive of easyMoney. “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.”
Ferrando explained that flats are “an outlier” because the pandemic and lockdowns prompted a “race for space” that they could not satisfy, alongside external cladding issues highlighted by the Grenfell tragedy.
“Despite this, however, flats have still delivered positive 10-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,” he added.
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