House prices could suffer a small hit in Britain’s wealthiest “Tory heartlands” if Waitrose stores are replaced by discount supermarkets, according to a property expert.
But Dan Parr, vice-president of data and property specialists CACI, said it would probably have no impact on property values in more average areas, because of the growing popularity of Aldi and Lidl among middle-class shoppers.
Debate has raged for years about the ‘Waitrose effect,’ with some experts claiming stores boost property prices, but others saying more expensive areas simply attract more Waitrose branches.
One disgruntled resident of Poynton, Cheshire, caused a stir in 2012, saying a new Waitrose meant “real progress” while the town’s new Aldi signalled “a step back into the lower class.”
Now Waitrose has re-ignited the debate by announcing it will lease three stores in Bromley, Oadby and Wollaton to Lidl, sparking fresh concern among homeowners it could dent house prices.
Parr said homeowners had little reason to fear the arrival of discounters in most areas.
He told Yahoo Finance UK: “Does having a Waitrose nearby make it more desirable? Yes. But does Aldi or Lidl replacing it have a negative effect? I don’t think it does any more.
“There’s far less stigma about them, particularly when they have premium bottles of wine and other products. The affluent will seek them out.”
But he said attitudes in wealthier areas could make them an exception. “It could have an impact in the most affluent places,” he added.
“Bromley is an outlier - historically it’s been a Tory heartland, full of affluent commuters, and it’s a surprise to see that store close. It’s the kind of area where people might be more put out by having it swapped to a discounter.”
He highlighted the chicken-and-egg nature of the debate, with “Waitrose there because of the affluence in the first place.”
Parr said the ‘Waitrose effect’ was real but probably only a small factor, with supply and demand for particular kinds of property, easy commutes, good schools and desirable high streets overall the key drivers.
He also said Waitrose store closures could be down to changes in the way Brits shop, such as the growth of online deliveries for ‘bog rolls and dog food’-type shops and more frequent smaller shops in store for fresh food.
“That’s killed off bigger supermarkets,” he said, adding that Waitrose customers could also be more likely to have shifted to ordering veg boxes online and visiting farmers’ markets.