The amount of properties in the UK that cost £1m or more is expected to more than triple by 2030, according to research by Santander Mortgages.
At present, less than half a million homes in the UK are valued at £1m or more, but this is set to increase to over 1.6m properties in the next 15 years.
Santander, alongside economist and the London School of Economics’ Paul Cheshire, studied the future of the UK property market, focusing on £1m-plus homes and what fuels house price growth.
The Property Millionaires: The Growing Housing Divide report found that by 2030, 25% of housing stock in London will be valued at £1m or more, reaching 70% of all homes in two London boroughs.
While 7% of properties in the South East are set to cost £1m or more by 2030, less than 1% of homes in the North East, Yorkshire and the Humber, the North West, Scotland and the East Midlands will hit the same value, highlighting a clear geographical divide.
Around the UK, the average property price – currently £283,565 – is expected to rise by 23% by 2020, to £349,300.
£1m Homes To Triple by 2030, says Santander
In 15 years’ time, the average UK house price will have almost doubled and surpassed the half a million pound mark, at £557,444.
While house prices are expected to spiral, forecasts suggest that incomes will not keep pace, causing an overall decline in affordability.
Currently, the average UK property price is 7.9 times the average wage. However, by 2030, it is expected to reach 9.7. Again, this trend will be more prominent in the capital, where prices are currently 11.5 times incomes and are predicted to increase to a huge 16.5 by 2030.
The Managing Director of Mortgages at Santander UK, Miguel Sard, comments: “Property price inflation will tip many existing homeowners 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.
“The current property market is buoyant and the deals available to new and existing owners are extremely competitive, so those wishing to buy or move shouldn’t be put off.”1
1 http://www.ft.com/cms/s/0/561a2c28-d588-11e5-8887-98e7feb46f27.html#axzz40Vm1ymxb