Are South facing property premiums a myth?

Are South facing property premiums a myth?

A new study commissioned by Direct Line Home Insurance reveals that despite estate agents and property experts espousing the benefits of a south facing garden, this is not reflected in the asking price.

Analysis of property asking prices reveals homes with south facing gardens carry a mere 0.37 per cent premium compared to properties with north facing gardens.

South facing gardens have long been touted as desirable because they typically get the sun for most of the day and are therefore thought to be warmer and brighter, but it appears this isn't reflected in property prices.

River views however do carry a higher cost, averaging 9% compared to identical properties located on the same development without this sought-after outlook. In one North London development, a three bedroom property with a river view has an asking price of £850,000 - 42% more than an identically proportioned and designed property elsewhere in the development that costs £600,000.

The research also reveals that in many cities if you live higher in a new development, you pay a significant premium for the privilege. One developer informed researchers they added a £15,000 premium to the asking price for every floor, bringing new meaning to the phrase 'sky high' prices.


An apartment on the 14th floor of a new London development five minutes from Angel tube station is on the market for £850,000, which is 31% more expensive than an identical property on the third floor.  In a new development near London's Colindale station a one bedroom flat on the fourth floor costs £438,950 while an identical property on the eighth floor is on the market for £475,0003.  

Katie Lomas, head of Direct Line Home Insurance, commented: “The research highlights that south-facing premiums may well be a myth, but a room with a view comes with a hefty price tag. People are prepared to pay thousands more for the same amenities and layout because a property is located higher in a building, has a more scenic vista, or because it overlooks water. However, while picturesque river views are much admired it is worth noting properties built near water may cost more to insure because of increased flood risk. Purchasers should check the likely cost of insurance before they commit to buy.”      

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Latest Comments

MBM Homelets
MBM Homelets 23 Mar 2017

Although this is a very positive step, there is little or no guarantee of the standard of workmanship employed by the tenants. We have had experience of a professionally decorated property being ' painted'...

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ajay
ajay 21 Mar 2017

How is the "robust evidence" looking now?

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NathanG
NathanG 20 Mar 2017

I've been watching the series so far and am completely baffled by the cases that were presented. Though, I don't think that we can protect ourselves from every scam possible - it will just make the scammers...

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Landlady14
Landlady14 01 Mar 2017

You would think so Niraj Shah! My experience only proves that there are varying qualitiers of professional in all aspects of property letting. None of the ones I have dealt with, from letting agents to...

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Mark
Mark 01 Mar 2017

Thanks for this article. Hopefully one day everybody's lifestyle will be eco-sustainable.

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Ben Taylor
Ben Taylor 28 Feb 2017

I was convinced that London was the most expensive!

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Alan Read
Alan Read 28 Feb 2017

Australia are leading the way in this I think. The trouble with Britain is we don't get enough sun to make use of solar power.

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James Powell
James Powell 27 Feb 2017

This is a very good news.

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DanHumphreys
DanHumphreys 27 Feb 2017

It sounds like a good idea. Anything to help the younger generation get a foothold.

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Matt
Matt 20 Feb 2017

Is this fake news?

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Matthew Hollywood
Matthew Hollywood 07 Feb 2017

Matthew Hollywood - Director Mishon Mackay Land & New Homes - Brighton The shortage of New Homes is in part effected by the lack of land sales. Land sales are held back because there is a disparity between...

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CommercialTrust
CommercialTrust 30 Jan 2017

Hi Graham, Would be interesting to see the above figure calculated against an investment via a Lt Company /SPV structure and if the investor found themselves pushed in to the higher tax bracket. Mortgage...

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