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How Nearby Supermarkets Can Help Boost Home Values

Living close to a supermarket has a bigger benefit than convenience alone. Research confirms that it can also increase the value of your home by an average of £22,000.

The study by Lloyds Bank also suggested that properties in the vicinity of upmarket grocer Waitrose are worth close to £40,000 more than others of equivalent size.

But upscale brands are not the only ones capable of adding value. Homes close to discount brands Aldi and Lidl also command a greater sale price, with the latter adding nearly three times as much value as an Aldi.

Lloyds Bank compared property prices in postal districts that have larger supermarkets with average house prices in the wider area. It included that proximity to a supermarket can mean an extra £22,000 when it comes time to sell.

The size of this bonus depends on the brand of the supermarket. The ‘Waitrose effect’ can add £38,666 to a sale price while an Aldi in the neighbourhood may mean an extra £1,333.

Living hear a Sainsbury’s or Marks & Spencer can boost a house price by around £22,000. Proximity to an Asda can mean an extra £5,000, and homes within walking distance of Lidl or Aldi are worth £4,000 and £1,300 more than properties in the wider area.

 

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It’s probable that prices are not only impacted by the local supermarket, however. Experts point out that a Waitrose or Sainsbury’s may have simply have built a branch in a particular location because of its relative affluence.

Aldi and Lidl have grown in popularity because they present a budget-friendly alternative to the big supermarket chains. By opening branches in areas that are already cheaper, both chains keep costs -and therefore prices- low.

Properties in Chiswick, West London, which are close to upmarket brands like Waitrose, sell for an average of £961,564, which is nearly double the £484,826 that the average home in nearby Hounslow sells for.

However, proximity to a Waitrose is not the only reason why areas like Chiswick are more expensive. Lloyds Bank mortgage director Mike Songer said that there are other house price drivers, but the bank’s research suggests that it remains a strong factor.

Homes with a Waitrose in the area sell for an average of £425,428, as opposed to £386,763 in other parts of the same region. This is not surprising, as Waitrose is popular among middle and higher income shoppers, and is more selective about where it opens a new store.

Sainsbury’s also provided a value boost to 10% to homes near one of its stores. The properties are worth an average £27,939 more than those in the same region that are not near a branch.

Next on the value-added scale was Marks & Spencer's food stores, which added 9%, or £27,182, to nearby homes followed by Tesco, which also represents an extra 9%, or £22,072.

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