How Does The Proximity To Supermarkets Affect House Prices in London?
There are many contributing factors influencing the value of a property. When we take a look at the factors that contribute to property prices, the first thing that is most likely to come to our head are the number of bedrooms in a home, whether the home has a garage, driveway or loft conversion and even the location of the home.
It’s well-known that if your home is situated within walking distance of a local school, college or university, then the value of your property is likely to be around 8% higher – although that’s only if the schools are recorded as best-performing.
One thing you may not take into consideration is the effect of local supermarkets in influencing the value of your property. The benefits of having a supermarket within walking distance can be summed up with the benefits of time and convenience. It might be a surprise to some that if your local area is lined with trendy independent coffee shops and high-end supermarkets, your property value is expected to have an increase of 15%. However, for London properties, studies show that having a premium brand on your doorstep is likely to increase your property value by an eye-watering 50%.
The ‘Waitrose Effect’
If you haven’t heard of the ‘Waitrose effect’ before, then you might be shocked to hear that living within a reasonable walking distance of a Waitrose supermarket can give you a house price gain of 15%. For London properties, having the up-market property chain within walking distance can surprisingly boost your property value by almost double.
Studies show that there is a significant link between the value of a property and the distance between a convenient nearby supermarket, with Waitrose having the most notable impact.
Whilst Waitrose stocks quality goods at a higher price, the up-market supermarket chain attracts a specific demographic, which has become an automatic presumption of a wealthier female over the age of 60 who tends to favour locally-grown organic produce and high quality goods. This is proven to have strong links with the area the demographic typically lives in, as Waitrose shoppers are most-likely to own their own (detached) home and have a higher-than-average household income.
The presence of a Waitrose store influences many home-buyers’ decisions as to why they purchase in a particular area. In other words, those shopping at Waitrose are more likely to be willing to spend more on a new home than those who shop elsewhere.
It’s worth noting whether the opening of a new Waitrose store is the main trigger in rising house prices, or whether Waitrose selecting to open their stores in higher-valued areas, is not yet known. However, the direct correlation between the location of their stores and pricier areas has sparked a wide range of interest and questions.
With Waitrose having the biggest effect on house prices over the years, it’s no surprise that ‘budget’ supermarkets have since caught up on the action. If you’re concerned about your local area not having any high-end supermarkets nearby, you’ll be pleased to know that even areas with budget supermarkets have seen rapid house price growth, too.
The Waitrose effect has been known for some time now, but research now shows that all supermarkets add value to your property, however, some more than others.
Properties closer to budget supermarkets (including Aldi, Asda, Lidl, Tesco and Morrisons) have recently seen the biggest house price rise. In fact, properties located reasonably close to these stores have an average value increase of 15% over the past five years.
The infographic below shows results from a study conducted by WeBuyAnyHome’s Supermarket Index. The results show the top ten highest-priced London boroughs along with the supermarket with the highest density of stores within that area. Within the ten highest-valued boroughs, five had a high density of Waitrose stores.
Morrisons are predominantly known to be located in areas where houses are valued below-average, whilst Lidl has since become one of the biggest influences to property prices, even more so than Waitrose. The value of homes situated relatively close to a Lidl store has risen by a larger amount in comparison to Waitrose.
Around the UK, homes near a Lidl are worth an average of £5,411 more than properties further away from the discount supermarket chain. In fact, homeowners living between Waitrose and Lidl are most likely to be living in an area with the highest house prices.
Aldi also isn’t falling too far behind, with the German discount supermarket now known as the sixth largest retailer. The ambitious discount giant has spiked a trend in home buyers searching for homes near to their stores, so it looks like we should expect to see a connection with rising house prices here too.
Increase the value of your property
The convenience of having your weekly shopping within an easy reach may well be a top factor when choosing a location to live. We’ve discovered that buying a home near Waitrose and Lidl does add value to your home, which is good news if either of these two stores have recently opened their doors in your neighbourhood.
If you’re a property investor, you’ll be pleased to know that as well as searching for properties located nearby a high-end supermarket, there are other ways to increase the value of your property portfolio.
As a landlord with JOHNS&CO, you will receive a tailored range of services from our experienced lettings team, allowing you to benefit from a dedicated property manager on-site at each development we represent, a tailored marketing campaign to advertise your property to rent and our vast links with corporate companies. You can also be sure of efficient handovers, professional advice for rental legalities and even furniture installation too.
We know how important it is to keep void periods minimum, and we do everything we can to minimise them. This commitment has seen us let property in new build developments up to six months ahead of completion. To discuss your requirements in more detail, please contact us.