House prices near London’s M25 up over 550% since iconic oribtal was built

The average house price in 40 towns close to the M25, London’s iconic orbital motorway, has increased by 551% since it was opened 30 years ago, but not as much as prices in the city, new research shows.

Average values have grown from £59,183 in 1986 to £385,085 in 2016, a rise of £325,903 equivalent to an increase of £905 per month for the last 30 years, and an annual rise of £10,863 or 6.4%.

The £325,903 increase in prices of these M25 towns has significantly exceeded the £208,163 rise in average house prices nationally from £37,763 to £245,926 over the same period, according to the report from leading lender the Halifax.

A breakdown of the figures show that 10 towns have seen average property prices rise by at least £400,000 and Rickmansworth is now the most expensive town in the area.

In terms of average values, the most expensive towns close to the M25 are in the southern section of the motorway and on the north side, while towns east of London typically have the lowest prices.

However prices in these towns have failed to keep pace with more dramatic rise in property values in London over the past three decades. As a result, towns around the M25 are now typically significantly lower than in London despite being on a par when the motorway opened.

Barnet has recorded the biggest increase with the average price growing eight fold from £69,744 to £539,708, an increase of £469,964 or 674%. The next largest rise has been in Rickmansworth where the average value has grown by £468,448, followed by Reigate up £458,734, Leatherhead up £443,034, St Albans up £434,438, Chigwell up £426,255 and Epsom up £422,626.

Rickmansworth is the most expensive town in this survey with an average house price of £551,959 and overall, there are five towns with an average price of at least £500,000, including Reigate at £532,352, Leatherhead at £530,759 and St Albans at £501,634.

Four of the 10 most expensive M25 towns are between junctions five and nine on the southern section of the motorway between western Kent and Surrey with Reigate, Leatherhead and Sevenoaks with an average price of £498,648 and Epsom at £494,912.

The three most expensive towns close to the M25 in 1986 had an average price of £86,000 with Leatherhead at £87,725, Sevenoaks at £86,789 and Rickmansworth at £83,511.

Eight of the 10 least expensive towns are on the eastern section of the M25 from junctions 29 to 31 and one in Essex and north Kent. The least expensive are South Ockendon at £258,569, Grays at £268,195 and Erith at £276,127.

The research also shows that over the past three decades house prices in the M25 towns have typically outperformed the South East region as a whole. Average price of homes in the South East have grown from £51,947 in 1986 to £332,819 in 2016 an increase of 541%, compared to an average rise of 551% in the M25 towns.

Properties in the M25 towns also trade at a premium to the region, with an average price that is £52,267 or 16% higher than the South East average, up from £7,236 or 14% in 1986.

Since 2011, the average price for all towns has grown by 54%, easily exceeding the UK rise of 42%. In cash terms, the average house price has increased by £135,456, almost twice the national increase of £72,284.

More than eight out of 10 towns, some 34 of the 40 surveyed, have seen house price growth, in cash terms, of over £100,000 in the past five years. The biggest rises have been in Chigwell at 275,278, Reigate at £249,450 and Barnet £213,284.