You are here: Home - Household Bills - News -

A quarter of London homes will be worth £1m or more by 2030

Written by: Paloma Kubiak
An estimated quarter of London homes will be worth £1m or more by 2030 as the wealth gap between the richest and poorest in society widen, according to a report.

There are vast inequalities between the generations and geographical locations of individuals and families, according to a report published by The Institute For Public Policy Research (IPPR), commissioned by Channel 5.

While wealth inequality fell for much of the 20th century, it is now rising again with stark figures showing that the wealthiest 1% of households own 45% of the nation’s wealth. In contrast, the least wealthy half of all households own just 9%.

This means the wealthiest 1,000 have a combined wealth of £658bn while the net wealth of the lowest 30% stands at £200bn.

The report suggests that much of the inequality stems from the boom in property with the next generation set to have less wealth as a result.

In fact, fewer than half of millennials – those born between 1981 and 2000 – are expected to own their own homes by the age of 45. It added that every generation since the post-war ‘baby boomers’ has accumulated less wealth than the generation before them at the same age.

Looking at the property market now, the value of housing stock in London is greater than the housing stock of all stock in Wales, Scotland, Northern Ireland and the North combined.

By 2030, while an estimated quarter of London homes will be worth £1m or more, less than 1% of homes in the North East, Yorkshire, the Humber, North West, Wales, Scotland and the East Midlands will command that price tag.

If house prices continue to grow per square metre in the same way they have since 2009, by 2027 a square metre of property in London will be 10.9x the price of a square metre in the North East.

The IPPR report also suggested that debt is likely to rise faster than disposable income over the next decade. In 2017 prices, household disposable income is forecast to rise 10.3% by 2027 – from £48,000 to £53,000 and the average debt per household in 2027 will rise 11% to £85,700.

A final point of note from the report is that the concentration of wealth is likely to be exacerbated by automation and digitalisation in the economy as the returns to capital increase and the returns to labour decline.

There are 0 Comment(s)

If you wish to comment without signing in, click your cursor in the top box and tick the 'Sign in as a guest' box at the bottom.

Autumn Statement: Everything you need to know at a glance

Yesterday Chancellor Jeremy Hunt made his first fiscal statement in the role, outlining a range of tax measure...

End of Help to Buy: 10 alternatives for first-time buyers

The deadline for Help to Buy Equity Loan applications passed on 31 October. If you’re a first-time buyer who...

Moving to an energy prepayment meter: Everything you need to know

As households struggle with the soaring cost of energy, tens of thousands of billpayers are expected to move o...

What will happen if rates change

How your finances will be impacted by a rise in interest rates.

Regular Savings Calculator

Small regular contributions can build up nicely over time.

Online Savings Calculator

Work out how your online savings can build over time.

DIY investors: 10 common mistakes to avoid

For those without the help and experience of an adviser, here are 10 common DIY investor mistakes to avoid.

Mortgage down-valuations: Tips to avoid pulling out of a house sale

Down-valuations are on the rise. So, what does it mean for home buyers, and what can you do?

Five tips for surviving a bear market mauling

The S&P 500 has slipped into bear market territory and for UK investors, the FTSE 250 is also on the edge. Her...

Money Tips of the Week