Britain’s booming pandemic property market created 270,000 new millionaires last year, as sellers and landlords cashed in on sky-high prices. For potential new landlords looking to invest, those who act now are soon to reap the rewards of historically high yields from growing demand and value.
Demand for housing reached a 60% increase over the last two years, while supply teetered down to 40% below the average. The imbalance has resulted in house prices rising to keep up with rampant demand which is yet to slow down.
The post-pandemic market
Many property hunters were motivated by the opportunity to save up to £15,000 after Stamp duty was axed on the first £500,000 of property purchases until June 30th.
On July 1st 2021, the 0% threshold was lowered to £250,000 and the tax break ceased entirely at the beginning of October 2021. Britain’s housing market exceeded all expectations through the pandemic thanks to pent-up demand and the need for more space amid the introduction of remote working.
The stamp duty holiday stimulated a flurry of activity and there has been a limited supply of properties for sale ever since. Yet, this has yet to dampen the enthusiasm of prospective buyers.
Property millionaires
The aftermath of the pandemic has driven a boom in buyers purchasing properties for £1 million and up, as 80% of new ‘property millionaires’ were seen in the last year in various locations around the UK.
The number of homes worth £1 million has reached a record number of almost 700,000, which is a 22% increase from figures recorded in 2020.
This is the first time the number of million-pound properties has grown since 2015, with figures showing that one in 42 homes in the UK are worth £1 million or more, which is equivalent to 2.4% of all housing stock.
Total value of UK homes passes £10 trillion mark
In a record-breaking new total, the value of the UK’s 29.5 million homes has surpassed the £10 trillion mark. The astonishing sum of £10,049,743,000,000 was calculated by the Office for National Statistics.
The figure includes the value of all buildings, land, machinery, roads, the shares we own and the money in our bank accounts.
One in three homes grew in value by over £50,000
Of the UK’s 2.9 million homes, almost one-third shot up in value by more than £50,000 since the start of the pandemic.
The UK’s more affordable regions saw the largest incline, as remote working opened the housing landscape to buyers.
London and the South East account for over 3 million of these high valued properties, while in the South West, nearly 2 million grew by more than £50,000.
A further 9.4 million properties across the UK increased by £25,000-£50,000 in value.
Regional values
Homes in Wales saw the greatest increase in value since the pandemic began in February 2020, with house prices up 22% on average.
Wales was hotly followed by the North West and South West, where prices rose by 20% in both areas.
In London, which followed close behind the rest of the country both in terms of demand and price rises throughout the pandemic, the increase was 7%.
That’s less than half the national average increase, but this is because the average property in London costs 11.5 times the average salary, putting property prices way above the rest of the country. When looking at the whole of the UK, London and the South East still account for 23.5% of the total value of our housing.
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