One in every 42 homes \u2013 more than 700,000 \u2013 in the UK is now worth more than \u00a31 million, according to new research from estate agency Savills.\u00a0The vast majority of these \u2013 just under 350,000 \u2013 are in London while another 160,000 are in South East England. This means one in every 11 homes in London is now worth more than \u00a31 million, a record high.<\/p>\n
However, other areas of the UK have seen a retreat in the number of high-value homes, with the South East, East of England, the South West and Wales all experiencing falls.\u00a0Savills points to rising mortgage costs dampening the property market for the declines.<\/p>\n
Lucian Cook, head of residential research at Savills, comments: \u201cGrowth has been limited by higher mortgage costs and stretched affordability, further reducing some of the gains made over the course of the pandemic in suburban and rural areas. However, increased demand for city living driven by the return-to-work movement has re-balanced the market back in favour of London homeowners, with 5,000 properties crossing the \u00a31 million threshold in 2024.\u201d<\/p>\n
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The rise in property values in the UK is a long-term trend that has slowed but not abated in recent years.\u00a0The increase in \u00a31 million+ homes, and even lower value but rising property prices, has important implications for owners\u2019 wealth management, tax liabilities and retirement planning.<\/p>\n
Homeowners can find themselves sitting on highly valuable properties which could inadvertently create tax liabilities from duties such as inheritance tax (IHT).\u00a0IHT is due on an individual\u2019s assets over \u00a3325,000. However, estates benefit from a \u00a3175,000 nil rate residential band \u2013 meaning up to \u00a3500,000 of someone\u2019s home could be exempt from IHT liability.\u00a0Taken with a married partner, this means a house up to the value of \u00a31 million could be exempt.\u00a0But this says nothing of additional assets which could then be liable for IHT above these allowances.<\/p>\n
It is essential therefore for homeowners to ensure they have carefully considered plans in place to minimise potential liabilities.\u00a0Consideration also needs to be made for retirement income planning as homeowners who are too reliant on their property for their retirement could find themselves struggling to sell at the right price depending on property market conditions.\u00a0It is essential for anyone in this position, or if you\u2019ve even got a mix of assets such as pensions and other savings to consider how best to use long-term wealth in order to maximise its longevity and minimise tax implications.<\/p>\n
An adviser can help you plan to ensure the best outcomes possible for you and your family to achieve this.<\/p>\n","protected":false},"excerpt":{"rendered":"
One in every 42 homes \u2013 more than 700,000 \u2013 in the UK is now worth more than \u00a31 million, according to new research from estate agency Savills.\u00a0The vast majority of these \u2013 just under 350,000 \u2013 are in London while another 160,000 are in South East England. This means one in every 11 homes in London is now worth more than \u00a31 million, a record high. However, other…<\/p>\n