House prices in cities have risen by an average of 382% over the past quarter of a century from £35,209 in 1986 to £169,707 in 2011 and this exceeds the increase of 347% for the UK as a whole over the period.

The research from Halifax also shows that the majority of cities outperformed their region in terms of house price growth between 1986 and 2011. Nearly 70% - 40 of the 59 cities surveyed – recorded average house price increases above their regions average over the period.

Brighton & Hove is the city to have outperformed its region by the biggest margin; recording a 500% increase in average house prices since 1986 – 180 percentage points higher than the 320% rise for the South East as a whole. Truro and Edinburgh have seen the next biggest gains relative to their region. (Table 2)

Cities have done particularly well in relative terms in the four years since the housing market peaked in 2007. Three-quarters of cities recorded a better house price performance than their region between 2007 and 2011. House prices in cities have fallen by an average of 18% since 2007 compared with the UK average decline of 24%.

Eleven towns have become cities in the past 25 years. On average, these new cities have seen house prices increase by an average of 379% since 1986. This is slightly below the average rise for all those places that have been cities throughout the last 25 years (384%), but is above the 347% increase for the UK as a whole.

Commenting, Martin Ellis, housing economist at Halifax, said: "Cities have typically seen higher house price growth than the UK average over the past 25 years. The majority of cities have also outperformed their region. City house prices are generally supported by demand from those looking to gain from the economic and lifestyle benefits often associated with residing in major urban areas.

Ellis added “The experience of towns that have been made cities during the past quarter of a century has been mixed. Some have gone on to outperform their region after gaining city status whereas they had underperformed previously. This, however, has not always been the case. There are, therefore, no guarantees for homeowners in whichever town is awarded city status this year that they will see a benefit in the form of improved house price performance."