Homes in areas with chain supermarkets nearby are likely to attract bigger premiums than those without.
You might have heard of the ‘Waitrose effect’ where the value of a home is pushed up by its proximity to an upscale supermarket, such as Waitrose or M&S. However, research from Lloyds shows that house prices are not just affected by the more esteemed shops. In fact, budget supermarkets have been seen to push house prices up by a bigger margin than both luxury and regular food shops.
What do the figures show?
All types of supermarket influence house prices, and they all seem to be positive:
- Waitrose increases house prices by an average of £43,571
- Marks and Spencer shops attract a premium of £40,135
- Sainsburys can increase the average house price by £32,707
- Tesco increases the cost of local homes by £21,369
- Co-op pushes local house price up by an average of £21,020
- Iceland affects local asking prices by £17,445
Meanwhile, homes close to budget supermarkets, such as Aldi, Lidl, Morrisons and Asda can see their prices increase by an average of £29,316.
Why do shops affect house prices?
Living close to a supermarket means that shopping is much easier for families, especially those with children or mobility issues who may find it difficult to drive long distances to get to the shops. However, the reason may not be entirely practical, as Andy Mason, Lloyds Bank Mortgages Director, explains: “It’s easy to assume the effect of different factors on the value of a property but this research clearly shows that there is a significant link between the convenience of a local supermarket and house prices.
“The Waitrose factor has been known for some time and although the likes of Aldi can’t yet boost house prices in quite the same way, the research shows that all stores are now having a positive effect on local property prices.”
Is living close to a supermarket important?
Earlier this year, research from Savills revealed that homebuyers prioritise:
- Minimum maintenance
- Off-street parking
- Good location
- New home warranty
- Size and design of living space
- Quality of the neighbourhood
- Energy efficiency
Which doesn’t imply that living close to a supermarket is on the top of any new homebuyer’s ‘must have’ checklist.
However, the research also shows that buyers looking for a home in high-density, urban areas would prefer amenities to be within walking distance (44%).
While it’s not definitive, the combination of increased house prices in areas close to supermarkets, and the research from Savills shows that proximity to a supermarket is preferable, even if it is not a deal breaker for a home to be more remote.
How can you make sure that you get the house of your dreams?
There are three factors:
1. Knowing what you want
Before you start looking at potential properties, you will need to know exactly what features you need. You may wish to consider sitting down with your partner or your friends and discussing your needs and wants in detail. This will give you a more in-depth feel for the features you cannot live without, and those that you would like, but are willing to compromise one for more important aspects.
2. Determining what you will need to achieve it
The perfect home might not come cheap, so if you have a list as long as your arm of the key features you need to see in a property, you can expect that you will pay more than if you opt for a less-impressive property.
Do your research to see how much properties with all your desires are worth and see what is available in the local area, or location you wish to live in. This should give you an idea of the amount you will need to save to put a deposit on a home which has all the features you are looking for.
3. Creating a plan to help you to get there
Now you know what you are looking for and the amount of money needed to help you to get there, you can begin planning how you are going to reach those goals. That’s where we can help. As independent mortgage advisers, we are equipped to help you find the solutions and routes which will help you to meet your goals as efficiently as possible.
For more information, or to get started on your journey toward homeownership, get in touch with us on 0800 612 8099, or click here to request a call back.