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Last decade saw sharpest price increases in UK property market but research shows changing pattern

In the 2000s prices increased 62%, just ahead of the next biggest rise in the 1980s of 61%, the research into the housing market in the last 50 years from Halifax shows.
The worst performing decade for property prices was the 1990s when prices fell 22% in real terms.

Overall the analysis shows that pronounced cycles have been a key feature of the real estate market. It points to four distinct periods of rapid real house price growth; 1971 to 1973, 1977 to 1980, 1985 to 1989, and 1998 to 2007. Each was followed by a significant fall in real house prices.

Fifty years ago, the average home cost £2,507 and one in seven had an outside toilet. A half century on, the average home costs £162,085 and two in every 1,000 households still have an outside loo.

The decade-by-decade data paints a picture of Britain today more divided than ever by regional house price differences. Halifax found that the region with the lowest prices in 1960 was Yorkshire and Humberside and it remains the lowest now.

But every region in Britain has fallen further and further behind London. It said the difference was down to the rise in real earnings, which have increased more in Greater London than in any other region.

The type of housing we live in has changed dramatically. The semi-detached houses, the hallmark of suburban development in the 1930s, have fallen out of favour. Between 1945 and 1964, 41% of all properties built were semis, but after 1980 they fell to 15%. The number of bungalows built has also declined. Detached houses, however, which were 10% of the stock built between 1945 and 1964, accounted for 36% of new builds after 1980.

We are also far more likely to be living alone. In 1970, married couples lived in seven out of 10 houses, by 2009 this was at 42%. ‘The last 50 years have witnessed remarkable developments, with substantial changes in the both the number of households and their composition,’ said Halifax housing economist Martin Ellis.The research also shows that owner occupation in the UK has increased by 25% from under half, 43%, in 1961 to 68% in 2008. The biggest rise was in the 1980s after the government introduced the Right to Buy scheme which allowed council house tenants to buy their properties, often at a discount.
Consequently the proportion of homes that are privately rented has fallen from 33% in 1961 to 14% in 2008. The private rented sector was bigger than both the owner occupied and the social rented sectors until the middle of the 1950s.

But there has been a more recent rise in the private rented sector as seen in the rise of the number of buy to let property investors. It has gone up from 9% in 1991 to 14% in 2008.