The number of “property millionaires” in the UK has soared since the beginning of the pandemic. A record 689,168 houses in Britain are now valued at £1 million or more, an increase of 22% since the end of 2020 and beating the previous record of 608,565 in 2015, according to Savills, the estate agency.
One in 42 properties in Britain is worth £1 million or more, 2.4% of all homes in the UK, Savills’ research shows. The high-value homes are predominantly in the southeast and the east of the country; one in 24 properties in the southeast and one in 40 in the east.
The total value of £1 million (or higher) properties stands at £1.365 trillion, with 125,928 new “property millionaires” in the past year, Savills has calculated.
Almost all of the new “property millionaires” can be found outside of London. The southeast of England is home to the highest number of new “property millionaires” with an increase of 36% in the number of homeowners whose home is worth £1 million or more, taking the total number of “property millionaires” in this region to 44,484.
The Beverley Hills of Britain
Elmbridge, Surrey boasts the largest number of homes worth £1 million or more outside of London, earning it the nickname of the “Beverly Hills of Britain”.
The number of £1 million homes in the district was up by 5,443 to 21,487 in 2021. In other words, almost 40% of all homes in the area are valued at £1 million or higher.
There has also been a notable increase in high-value homes outside of England. In Wales, there was a 63% leap in “property millionaires”. In Scotland, the number increased by 31% to 9,820: one in 270 houses in Scotland is now worth £1 million or more.
Houses Space Race
The surge in the number of £1 million homes outside the capital is attributed by Savills to the “pandemic race for space”. The COVID-19 pandemic has pushed more people to look for houses outside of London.
The increase in the number of properties outside of the capital worth £1 million or more, therefore, has been largely brought about by a “pandemic-induced reassessment of housing need”, according to Lucian Cook, head of residential research at Savills.
House prices have rocketed in suburbs, villages and market towns across the UK, fuelled by the higher demand.
Houses in London
London remains the most expensive region in Britain, where the average price of a detached house was more than £1 million, at £1,050,087 in December 2021. Even a “modest” two-bedroom apartment can cost more than £1 million in the capital, according to The Times.
London is home to almost half of all properties worth £1 million or more. One of 11 properties in London is worth £1 million or more. However, in London, the number of “property millionaires” rose by 8% over the last year, the smallest increase across the UK, with the remaining 80% located outside of the capital.
Some of the regions in which there are fewer £1 million properties experienced the biggest increase in property millionaires. In Rother, East Sussex, there was a 74% rise in properties valued at £1 million or more, yet they make up only 1.8% of all homes in the district.
Typical UK holiday destinations have also seen an increase in £1 million properties. In Cornwall, for example, the number of houses worth £1 million or more jumped from 2,900 to 4,550.
But soaring house prices can put the squeeze on local residents, who struggle with affordability. Duncan Baker, Conservative MP for North Norfolk, a popular holiday destination, points to a “disproportionate number of people coming out of London and surrounding areas to live in North Norfolk”.
Local people are at risk of being pushed out by rising house prices. According to Baker, “it has made buying in coastal hotspots unobtainable for local people”.
The Impact of Rising House Prices
The rising number of “property millionaires” might not have a positive impact on the housing market overall. The pandemic, for example, has also resulted in a decrease in social housing.
The government proposed in 2019 to supply 300,000 new homes each year by the mid 2020s. Only 216,000 were supplied from 2020 to 2021. This is drop from the 243,000 that the government supplied the year before.
There is a backlog of need for new housing and “affordability pressures can prevent people from accessing the housing they need”, according to research published to the House of Commons Library.
Conservative MP Ben Everitt, who is chairman of the All-Party Parliamentary Group for Housing Market and Housing Delivery, is positive that as a country “we definitely need more social housing”.
According to Everitt, the increases in “property millionaires” and £1 million properties “demonstrate that the housing affordability crisis continues to be one of the greatest problems that the UK faces.”