26 Apr 2013

£1m house sales soar to highest rate since recession

House sales over £1m have bucked the national trend and soared to their highest level since the height of the 2007 housing boom, says a new report.

£1m house sales soar since recession (G)

House sales in many parts of the country have fallen, as banks demand higher deposits and renters struggle to save deposits.

But not when it comes to top-end properties: sales in this sector have increased by 2 per cent year-on-year in 2012, with Scotland, the East Midlands and London all seeing rises.

A Lloyds TSB report found that million pound properties out-performed the rest of the market in 2012, as sales of homes below this price bracket dropped off by 3 per cent year-on-year.

Sales at the very top end of the market are much closer to their peak levels than the market as a whole – Nitesh Patel, Lloyds TSB housing economist

Across Britain, 7,397 homes with a price tag of over £1m were snapped up last year, marking the highest number seen since 2007.

The London boroughs of Kensington and Chelsea and Westminster accounted for almost a quarter of all the sales which took place.

By contrast, just four sales of million pound homes took place across Wales during 2012 and nine were made in north east England.

The Government imposed a 7 per cent stamp duty rate on homes worth over £2m in March 2012, but David Cameron has ruled out a so-called “mansion tax”.

Foreign buyers

More than one in 20 homes sold in London in 2012 were worth over £1m – a reflection of wealthy overseas buyers looking for a safe haven for their cash. And London and the South East made up 85 per cent of all million pound home sales last year.

Nitesh Patel, Lloyds TSB housing economist, said: “Strong demand from wealthy, cash rich buyers, from both the UK and overseas, as well as limited supply, has supported this sector of the market.

“As a result, sales at the very top end of the market are much closer to their peak levels than the market as a whole.”

Despite the boost felt at the top end of the market, activity levels still have some way to recover, with million home sales last year still running at 10 per cent below their 2007 peak.

Lloyds TSB used figures from the Land Registry and the registers of Scotland for its findings.

Homes sold for over £1m by region in 2012
North East, 9, (down 40 per cent)
North West, 79, (down19 per cent)
Yorkshire and the Humber, 38, (down 21 per cent)
East Midlands, 47, (up 12 per cent)
West Midlands, 58, (down 12 per cent)
East of England, 458, (down 5 per cent)
London, 4,820, (up 6 per cent)
South East, 1,493, (down 5 per cent)
South West, 240, (down 9 per cent)
Wales, 4, (down 71 per cent)
Scotland, 151, (up 14 per cent)
Britain, 7,397, (up 2 per cent)