2011 has been a mixed year for many home owners it seems, especially now with the news that this year has created 26,744 new property millionaires, despite the average property price in the UK falling by 3% to £221,128.
Millionaires Created Every Day
A high demand for prime properties from equity-rich buyers coupled with relatively low supply of large homes has helped to create 73 new property millionaires every single day in 2011. This information has been revealed by Zoopla.co.uk. Another rather astonishing figure is that one in every 108 homes in the UK is now valued at £1 million or more whereas during the peak of the property market in 2007 that figure stood at one in 97.
Research has found that there are now 253,118 homes in the UK that are worth more than £1 million. Unsurprisingly, the largest rise in the number of property millionaires was in London where the amount has increased by 18% over the year. London also now accounts for over half the national total of properties worth at least £1 million at 55%.
Steep Prices in London
Our capital city has consistently been one of the only places in the UK that has seen rising property prices during the economic downturn. Demand in London is still so strong despite the recession. It is, after all, the financial hub of the UK and one of the busiest, most popular and most loved cities in, not just Europe, but the world. So with that all in mind, it is really not a surprise in the slightest that property markets in London have remained so strong.
With the Olympics on the way next year, it is also likely that property prices will rise further, and it is expected that rental prices will also see an upward trend over the coming months.
Furthermore, London was home to nine of the top 10 areas in Britain with the highest property prices. The highest proportion of £1 million or more homes was Kensington W8 where 56% of all homes were worth more than £1 million.
Overseas Investors have Contributed
We must remember also that London has seen strong demand from overseas investors, especially Greeks and Italians this year due to the financial difficulties that their respective countries have faced. It is therefore little surprise that the number of property insurance quotes being taken out by overseas investors has increased.
Nick Leeming of Zoopla.co.uk has stated the following: “While most of the market is suffering from the impact of inflation, stagnant wage growth, the inability to secure mortgage finance and nervousness about the future of the economy, at the upper end of the market, cash and equity rich buyers are enjoying some of the lowest mortgage rates in recent history.”
It seems for some property owners, most of which are indeed in London, it should be a very fruitful Christmas period.