House prices lead to more millionaires

New research has found that the number of millionaires in the UK has dramatically increased, with as many as 175,000 households in London now hitting

12:30 25 August 2004

New research has found that the number of millionaires in the UK has dramatically increased, with as many as 175,000 households in London now hitting the big time.

The Centre for Economics and Business Research (cebr) estimates there are now around 425,000 millionaires in the UK.

This is a considerable increase from 230,000 in 2001. The cebr explains that the 64 per cent jump in the price of the average house since 2001 has been partly responsible for this millionaire increase.

It estimates that because of high house prices, 175,000 or 41 per cent of these millionaires live in London, which represents 5.5 per cent of all households.

A further 90,000 live in the rest of the South East. Other regions with significant numbers of millionaires include 32,000 in the South West and 29,000 in the East of England.

These southern areas would therefore be the most affected if the government implements its latest proposal: a death duty rate of 50 per cent on estates above 763,000.

However, as valuation is normally on the cautious side for estate duty purposes and because people tend to give away some of their wealth towards the end of their lives, the cebr feels that the new ruling is unlikely to affect many households who do not currently have net worth of over a million pounds.