Does a local Lidl really bring down house prices?

Aug 1, 2019

Houses near a Waitrose are worth 12% more than average – and now three of its supermarkets have been sold to Lidl. But the discounter’s arrival might not be all bad news …

Waitrose has sold off three of its supermarkets to Lidl, sparking a wave of middle-class outrage. It’s not just concern about access to venison meatballs or pistachio ice-cream – residents of Bromley in London, Oadby in Leicestershire and Wollaton in Nottinghamshire apparently fear their house prices could take a dive.

Kal Kandola, 49, told the Telegraph: “We are regulars at Waitrose and not very happy about this at all. I have houses in Wollaton that I rent out. The issue of house prices is a concern as Wollaton is an affluent area.”

Homes near the upmarket supermarket chain enjoy the “Waitrose effect”, commanding a 12% premium (£43,571) on the average home, according to research by Lloyds Bank last year.

But the hand-wringing by local residents may be unnecessary. The value of homes near to budget supermarkets such as Lidl rose by a larger amount than those near a Waitrose – up 15% over the past four years, according to Lloyds. Homes near a Lidl are worth £5,411 more than other properties in the nearby area.

Meanwhile, discount stores are increasingly popular with affluent shoppers. Attracting more middle-class bargain hunters with cheap cheese and wine has helped Lidl and Aldi overtake Waitrose to become the UK’s fifth and seventh largest grocers, controlling nearly 14% of the market, according to analysts at Kantar, up from about 10% only three years ago.

The housing market analyst Neal Hudson said the supermarket switch was unlikely to make a difference to house prices. “The presence of a Waitrose reflects a whole range of demographic drivers that reflect why people buy in an area. You are far more likely to find that something like a school changing its catchment will affect prices. There are bigger risks at the moment for people worried about prices. With a no-deal Brexit on the horizon, there is more concern about that.”

Article originally posted by the Guardian