Homes in close proximity to supermarkets command an average price premium of £15,000
New research from Lloyds Bank has found that the average house price in areas which offer residents easy reach of a local supermarket is around 7% (£15,331) higher when compared to other areas within the same town which don’t.
By comparing average prices in postal districts (e.g. NE20), which have a national supermarket, to the wider post town (e.g. Newcastle), it has been possible to identify the average house price premium or discount associated with the proximity to some of the UK’s largest grocery retailers.
Properties in areas with a Waitrose, Sainsbury’s or Tesco are most likely to command a higher house price premium when compared to the wider town average. The average price premium for properties within easy reach of a Waitrose is 12% (£38,831) higher than the wider town, Sainsbury’s 10% (£24,507) and Tesco 8% (£17,124).
The analysis also looked at locations with the highest area to town house price premium. Chiswick in Hounslow, Ponteland in Newcastle and Golders Green in Barnet command the greatest average property prices when compared with the surrounding town average.
The average house price in Chiswick, which offers residents a Waitrose, Sainsbury's and Marks and Spencer, is £918,287. This is a premium of 117% or £495,601 when compared to the average price for the borough of Hounslow. Ponteland, which has a Waitrose, Sainsbury's and Co-Op, and Golders Green, which has a Sainsbury's and Marks and Spencer, have premiums of 110% (£195,623) and 88% (£456,829) respectively.
Andy Hulme, Lloyds Bank mortgages director, commented: “It’s easy to assume the effect of different factors on the value of a property but this research enables us to clearly see that there is a significant association between the convenience of a local supermarket and house prices.
“With homes in areas close to national supermarkets commanding an average of over £15,000 more than those in the surrounding areas, having a grocery shop within easy reach appears to be high on the list for homebuyers looking for good access to local amenities.”
Regionally the greatest house price premium that can be aligned to a supermarket presence is in the West Midlands, where areas with a local Waitrose command an average 37% (£66,130) more than the surrounding town. This is followed by the same supermarket in the North West 33% (£63,921) and London 14% (£76,188).