Are Lancaster House Prices Really £50,225 Cheaper Than in 2007?

 

If you are currently trying to buy a home in Lancaster, you may think I have completely lost the plot.

House prices are higher than they were. Deposits involve much larger sums of money, mortgage payments can be eye-watering and the cost of everyday life has increased too. It is perfectly understandable that many people believe buying a home must have been much easier in 2007.

But the figures are interesting.

In 2007, the average Lancaster home cost £140,425. Today, in 2026, the average price is £194,817.

That is an increase of £54,392, or 38.7%. Looking at those numbers alone, Lancaster homes are clearly more expensive.

The difficulty is that £140,425 in 2007 was worth far more than the same amount of money would be today.

 

What happens when we include inflation?

Inflation has risen by 74.5% since 2007. We all see the effects of that in our weekly shopping, energy bills, cars, holidays and the cost of having work done around the house.

If we adjust Lancaster’s average 2007 house price for inflation, £140,425 becomes approximately £245,042 in today’s money.

The average Lancaster home today costs £194,817.

That means, once inflation is allowed for, the average home is actually £50,225 cheaper than it was in 2007. That works out as a fall of around 20.5% in real terms.

I know it sounds odd. How can a house cost more and be cheaper at the same time?

The answer is simply that the value of money has changed.

Back in 2007, £1 would have bought around six Cadbury Freddos. Today, you would get about two and a half. You still have £1 in your hand, but it does not buy what it once did. Sadly, not even when it comes to a Freddo!

It is the same with property. Looking at a house price from nearly 20 years ago without considering inflation does not give us a fair comparison.

 

Does that mean buying a home is easier now?

No, and I would never pretend that it is.

For many Lancaster buyers, finding the deposit is the biggest challenge. Even a 10% deposit on an average-priced home is nearly £20,000, and that is before paying for surveys, solicitors, removals and all the other expenses that come with moving.

Mortgage rates and lending rules matter too. A house may be cheaper in real terms, but that does not necessarily help if the monthly repayments are beyond your budget.

Wages give us another way of looking at it.

Average UK annual earnings were £21,944 in 2007. Today, they are £40,301. That is an increase of 83.6%, compared with inflation of 74.5%. On average, wages have increased by approximately 5.2% in real terms.

Over the same period, Lancaster house prices have risen by 38.7% in cash terms, which is well below the increase in both wages and general prices.

Of course, averages never tell us how every household is feeling. Some people’s wages will have risen by much less, while rent, childcare, food and energy costs may be taking up more of their income. First-time buyers also face the challenge of saving a deposit while paying rent.

That is why buying can still feel harder, even though the average Lancaster house price has fallen in real terms.

 

Why does this matter?

It is easy to look back at a £140,425 house price and think homes were incredibly cheap.

They were cheaper on paper, but £140,425 was a much more substantial amount of money in 2007 than it is today. In today’s terms, it was closer to £245,042.

This does not make the challenges facing buyers disappear. It does, however, show why we need to be careful when comparing house prices from different decades.

Lancaster house prices have risen, but not by as much as inflation or average wages. In real terms, the average home is around £50,225 cheaper than it was in 2007.

It is not the answer most people would expect, but that is what makes the figures worth sharing.

 

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Frequently Asked Questions

Are Lancaster homes actually cheaper than they were in 2007?

Not in cash terms. The average price has risen from £140,425 to £194,817. However, £140,425 in 2007 had the same buying power as approximately £245,042 today. After allowing for inflation, the average Lancaster home is therefore around £50,225 cheaper.

Why does buying a home still feel so difficult?

A house price is only one part of the cost of buying. Buyers also need to find a deposit, qualify for a mortgage and manage the monthly repayments alongside other household bills. These pressures can make moving difficult, even when property prices are lower in real terms.