It’s another sign of just how crazy the British property market is right now.
More than 200 people a day in Britain are becoming millionaires, simply by owning a home, thanks to the insane growth of property prices that we’ve seen in the past few years.
Online estate agent Zoopla says that there are now 620,000 privately-owned flats and houses across the UK worth more than £1 million, 75,000 more than there were when they last surveyed the million-pound property market in January, and that’s making a lot of people asset rich.
The boom in so-called “property millionaires” — people who own bricks and mortar assets worth more than £1 million — is being driven, obviously, by London, where the property market is so hot that there are serious fears of a bubble that will could soon burst. More than 10% of London residences are now worth more than a million, Zoopla says.
Within London, the rise of the property millionaire is being fuelled by the increasing gentrification of many areas in the east of the capital. All six of the London boroughs with the most new millionaires are out east, according to Zoopla’s research. Areas like Barking and Dagenham, Newham, Waltham Forest, and Redbridge, were, until very recently, were not exactly places people were clamouring to live.
However, as central London grows ever more expensive, people are looking further out, and east London is becoming increasingly attractive, pushing up prices and creating a huge rise in the number of £1 million houses and flats in these boroughs.
Redbridge has 56% more property millionaires than in January, Newham a huge 88% more, and Barking and Dagenham has seen its number nearly triple, growing by 288%. Although, in fairness, this is an increase from three to ten seven-figure houses.
Boroughs traditionally seen as upmarket, like Westminster, Kensington and Chelsea, and Islington, haven’t seen big growth in the number of property millionaires, simply because most houses in those areas are already worth substantially more than £1 million.
Outside of the capital, the east of England, which gets a ripple effect from London property prices, has 28% more property millionaires than in January, while Yorkshire and the Humber is also doing nicely, seeing a 24% rise in £1 million homes. Every other region of the UK — except Scotland, which was hit by a new property tax in January — now has more property millionaires than at the start of 2015.
Zoopla’s study follows a report from the National Association of Estate Agents that the price of a house in Britain is likely going to double in just ten years, and that by 2025 houses in London will be worth nearly £1 million ($1.5 million) on average.