British property millionaires up by a fifth

The number of property millionaires in Britain has soared by almost a fifth year-on-year despite the housing market’s continued difficulties, a study has found.

There are more than 300,000 property millionaires estimated in Britain – a 19 per cent annual increase, property search website Zoopla said.

The number in Scotland rose by more than 6 per cent from 6,835 to 7,264.

Relatively strong price growth in London and the South-East of England has helped to push the value of a further 47,024 properties over £1 million during 2012, bringing the total to 300,142, the study found.

Across the rest of Britain, the number of property millionaires in Scotland broke through the 7,000 barrier last year, while outside London and the South West, the East of England has the biggest concentration of property millionaires, with more than 20,000.

Wales has the lowest number of property millionaires on a regional level, with Zoopla putting the figure at 844.

London has had strong demand from wealthy overseas buyers looking for a safe haven from the eurozone troubles and prices have also been driven up by a limited number of homes in these markets for potential buyers to choose from, Zoopla said.

The website also pointed out that wealthier buyers were often less reliant on the need to raise a mortgage, meaning many of them have been more sheltered from the effects of lenders tightening their borrowing criteria amid the weak economy.

Almost two-thirds (64 per cent) of Britain’s property millionaires live in London, with the equivalent of 100 new property millionaires being created in the city every day last year, Zoopla said.

Kensington wears the crown for the biggest concentration of property millionaires in Britain, with homes there costing an average of £2.2 million, and 64 per cent worth more than £1m, Zoopla found.

The value of the equivalent floor space in Kensington to an Amazon Kindle (228cm squared) is a staggering £389, researchers said. Despite its relatively small size as a London borough at 12 sq km, Kensington and Chelsea contains 12 per cent of Britain’s property millionaires, at 36,293.

Lawrence Hall, spokesman for Zoopla.co.uk, said: “The top end of the property market operates seemingly in isolation to the rest of the market.

“Wealthier buyers are relatively impervious to the economic problems affecting the rest of the market, most notably when it comes to getting a 
mortgage.

“Foreign buyers in particular have gravitated towards top-end property in 
London over the past few years, which has pushed up demand and prices alike on the more 
expensive property as they try to secure a limited supply 
of top-end homes in the 
capital.”

Some analysts have suggested that a 7 per cent stamp duty rate on homes worth over £2 
million, which was introduced last spring, could cause the top end of the London market to cool off slightly this year, although there is general agreement that prices in the city are likely to continue on an upward path in 2013.

The research was taken from Zoopla’s own website, which uses various factors such as recent sales in the local area to estimate how much homes are worth.

Sharpest fall in Scots property values last year

THE annual house price report from Nationwide showed average property values in Scotland fell 3.3 per cent to £131,795, the sharpest fall anywhere in the UK apart from Northern Ireland.

The building society’s study also found evidence that the north-south divide in England is widening, with the price of a typical home in the south now standing at a new high of around £95,000 more than in the north, representing a 2 per cent increase compared with the end of 2011.

Across the UK, house prices fell by 0.1 per cent month-on-month in December and they are likely to remain flat or edge lower still during 2013, Nationwide predicts.

The monthly decline meant that at £162,262 on average, prices dropped by 1 per cent over 2012, reversing a 1 per cent increase recorded in 2011.

ANGUS HOWARTH