1 in 4 Properties will be Worth £1m+ by 2030
The number of UK properties worth at least £1 million is expected to more than triple between now and 2030, according to a new report from Santander Mortgages. This means that almost 1.6 million homes in UK will be worth at least £1 million in the next 14 years which equates to one in every four properties.
Using these figures and taking the cost of an average UK home in account, which National Homebuyers knows is £283,565 (according to the Land Registry), this would mean an increase of 23% to £349,300 in just five years and will have nearly doubled by 2030 to a whopping £557,444.
Currently less than half a million homes in the UK are valued at £1 million or more, but according to these new figures which have been put together by LSE Professor of Economic Geography Paul Cheshire in partnership with Santander, this is set to rise to over 1.6 million in just 14 years.
This new report entitled “Property Millionaires: The Growing Housing Divide” has also stated that by 2030, 25% of houses located in London are expected to be valued at £1 million or more, rising to a staggering 70% in some part of the countries capital. The report used official house price figures and considered past patterns in real incomes, population changes, housing construction and interest rates to make the predictions.
The report goes on to point out that this increase in property prices will continue at a fast rate but average incomes over the same period will not raise at the same pace meaning that property could ultimately become unaffordable to first time buyers. At present in the UK, the average property price is 7.9 times the average income, but by 2030, this is expected to hit 9.7 times the average salary.
Miguel Sard, Managing Director of Mortgages, Santander UK, said:
“Property price inflation will tip many existing home owners into the million pound price bracket but could also price some aspiring buyers out of the market if they don’t have the right support.”
Professor Cheshire adds:
“By 2030 the divide between housing haves at the top and the have-nots at the bottom will be even wider than it is now. More owners will enjoy millionaire status, as homes that many would consider modest fetch seven figure prices in the most sought-after areas. Property price inflation is beneficial for existing owners who will see their net-wealth increase, but it will make entering the market more difficult still for new buyers, further highlighting the importance of the right timing, advice, support and financial planning; and not just having a mum and dad who bought a house but a grandparent too.”
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