Comparing house prices between streets and postcodes
Sold prices can be looked at for a whole postcode area, a district, a sector or a single street. Each level tells you something different, and the figures are not always comparable.
This guide explains how postcodes are built up, why street medians move around more than postcode figures, and how to read a street page against the postcode it sits in.
How a postcode is built up
A full UK postcode has two halves. Take N7 6PA as an example. The first half, N7, is the outward code. The second half, 6PA, is the inward code.
The postcode area is the letters at the start, here N, which covers a large part of north London. The postcode district is the whole first half, N7. The postcode sector adds the first digit of the second half, so N7 6. The postcode unit is the full code, N7 6PA.
There are around 120 postcode areas, around 3,000 districts, more than 12,000 sectors and well over a million units in the UK. A typical unit covers a small group of neighbouring addresses, often around 15, so it is usually part of a street rather than a whole one.
House Price Monitor reports at postcode district level, with street pages inside each district. Search the postcodes page to find a district.
Districts give the steadiest figure
A postcode district usually covers several thousand homes and records many sales each year. With that many sales, the median is stable and a handful of unusual sales cannot pull it far.
The trade off is that a district can be mixed. It may include a high street of flats, quiet roads of family houses and a new development. The district median sits somewhere among them and may not describe any one street well.
Sectors and units are more local but have fewer sales, so their figures move around more from one period to the next.
Checklist
- Check which postcode level a figure refers to
- Look at how many sales sit behind each median
- Compare the same property type in each place
- Use the postcode district when a street has few sales
- Allow for long roads that change along their length
- Read the street against its postcode before comparing streets
Why street medians vary
A street median is worked out from the sales on that street, and most streets have only a few sales a year. Which homes happened to sell has a large effect on the result.
As an illustrative example, a street of mostly two-bedroom terraces might have a median of £280,000 one year. If a large corner house and a converted flat sell the next year alongside one terrace, the median could move sharply without any real change in what the terraces are worth.
Streets also differ for real reasons. Size of homes, garden space, period or modern build, a busy road or a quiet one, and the school catchment can all separate two streets that sit side by side in the same postcode.
Long roads can change character along their length and may cross more than one postcode sector or even district. A main road with shops and flats at one end and houses at the other can have a median that suits neither end.
Sample size
On House Price Monitor a street gets a page once it has at least three registered sales. Three sales is enough to show a typical price, but not enough to measure change with any confidence.
When you compare two streets, look at how many sales sit behind each figure and over what period. A street with twenty sales gives a far firmer median than one with three. If one street has few sales, give its figure less weight and lean more on the postcode district. Our guide on average vs median house price explains why the median helps here.
Property mix
The single biggest reason two areas show different prices is the kind of homes that sold. A street of detached houses and a street of flats will never have similar medians, even if both are in demand.
HM Land Registry records each sale as detached, semi-detached, terraced, flat or maisonette, or other, and as freehold or leasehold, new build or established. Where you can, compare the same property type in each place. Two-bedroom flat against two-bedroom flat is a fair comparison. Flat against house is not.
Reading a street page against its postcode
Each street page on House Price Monitor shows the last sale on the street and the street's typical price against its postcode. That comparison is a quick way to place a street within its district.
If a street sits well above its postcode, that usually reflects larger homes, more houses than flats, or a sought-after position. If it sits below, it may have more flats or smaller homes. Before reading much into a gap, check the number of sales and the type of homes on the street.
The comparison is most useful as a starting point. To go further, look at individual sales of homes like yours, as described in estimating your home's value from sold prices. For change over time, see how to work out house price change.
Prices for your postcode
Postcode district and street pages on House Price Monitor are free to read. Find yours on the postcodes page.
The full monthly report for a postcode district lists every sale with its address and is £4.99 a month, with the first report free on sign-up. All figures are completed sales, not valuations or asking prices.
Estate agents and brokers comparing several areas can use the professional plan, which covers up to five postcodes with valuation packs of comparable sales.
Other guides
How to work out how much house prices have changed
How to estimate your home's value from sold prices
How to find what a house sold for