Sunday, 24 October 2021

Number of property millionaires rockets

RISING house prices have led to the creation of nearly 100,000 new property millionaires since the start of the pandemic, it has emerged.

An estimated 770,000 UK homes are now worth £1million or more.

According to the Office for National Statistics, the average UK home has gained in value by £31,000 over the past year.

With the average UK house price now standing at £266,000, this represents a rise of 13.2 per cent in the year to June — the highest rate of growth since 2004.

The rise has been fuelled by high demand and low supply, with stamp duty relief also helping to drive housing market activity.

Lucian Cook, Savills’ head of residential research, said: “It’s now nine weeks since the stamp duty holiday was curtailed in England and Northern Ireland and brought to an end in Wales.

“Without any shadow of a doubt, that pre-announced deadline contributed to both a surge in activity and a burst of house price growth across the housing market in the first half of the year.

“Data from HMRC suggests that for the first time ever in a single quarter there were over 50,000 residential transactions between £500,000 and £1 million from the beginning of April to the end of June.

“With more than 9,500 transactions for properties worth over £1 million, levels were well over double those expected for the time of year.

“The vast bulk of this activity has been driven by domestic buyers looking for more space. Indeed, across the market as a whole, only 2,700 transactions bore the new two per cent surcharge for non-UK resident buyers.

“More widely, properties bought by investors and second home buyers continued to account for less than a quarter of all purchases.”

Mr Cook said Savills’ analysts have started to get a clearer picture of what the market will look like going forward following the Government’s withdrawal of tax reliefs and easing of coronavirus restrictions.

He said: “New instructions remain 11 per cent below normal pre-pandemic levels, reflecting an ongoing shortage of stock to meet demand.

“Meanwhile, in the market over £1 million, agreed sales remain 65 per cent above normal pre-pandemic levels.

“That underpins our forecasts for further, though more modest and less consistent, house price growth in the second half of the year in both the prime housing markets beyond London and, as previously reported, the mainstream housing markets.”

Property