Despite a slowing market, 94% of homeowners scored a profit by selling their house
The average seller in England and Wales, who in 2022 sold a house bought within the last 20 years, made a gross profit of £108,000, according to residential estate agent Hamptons.
Analysis of its own data and those of the Land Registry has revealed that a record 94% of sellers sold their property in 2022 for more than they paid for it, having owned for an average of 8.9 years. In percentage terms, the average seller in England and Wales sold their home for 52% more than they bought it for.
Hamptons said that the uplift in seller profit has been driven by more households selling larger homes, which have been typically owned for longer. Nearly a quarter, or 24%, of homes sold in 2022 had been bought 15 to 20 years ago, up from 20% in 2019.
There are now 173, or 52%, of local authorities across England and Wales where the average homeowner made a six-figure gain when selling their home, up from 116 in 2021. Eighty-seven per cent (87%) of these local authorities were located in the South of England, down from 94% in 2021.
London is the only region where the average household gain exceeded £100,000 in every local authority during 2022. In fact, there were 17 boroughs where seller gains exceeded £200,000. Across the capital, the average seller sold their home in 2022 for £219,110, or 57%, more than they bought it for, having owned the property for an average of 9.3 years.
However, slower house price growth in London over the last few years has meant that, for the first time in at least five years, Welsh sellers are now making bigger gains than Londoners in percentage terms. In 2022, the average home in Wales sold for 59% more than its purchase price, surpassing the London average of 57%.
Hamptons also reported that while detached homes made up 19% of sales in 2022, they accounted for 35% of properties selling for six figure gains in 2022. The average detached home was sold for £186,940, or 61%, more than its original purchase price, 3.3 times the average gain made on a flat (£57,080) in 2022.
Though the percentage gain made by house sellers increased between 2021 and 2022, weaker house price growth meant that it stayed the same for flat sellers. The average house seller in 2022 made a 57% gain on their home up, from 51% in 2021, compared to 29% for flat owners in both 2022 and 2021.
“Soaring house price growth has boosted the money homeowners have made when they sell,” Aneisha Beveridge, head of research at Hamptons, commented. “House price gains are primarily driven by two factors – the length of time people have owned and the point at which they bought and sold in the house price cycle.
“2022’s record breaking gains were boosted by COVID-induced changes, with a rising share of sales coming from larger family homes that were typically bought before the financial crisis. However, most of these profits are never seen by sellers as they are reinvested back into the housing market when they make their next purchase which has also increased in value.”
Beveridge added that while there are a number of uncertainties weighing on the market and even if prices fall this year, it is likely that over 90% of sellers will still sell at a profit.
“The other 10% will mostly be flat owners who bought in the last five or so years,” she pointed out. “The shift away from recent mortgaged homeowners selling cheaper homes towards older, more affluent homeowners selling more expensive homes also looks set to push up gains among sellers again this year.”
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