"Over the last year, there’s been an increase in the number of houses being sold for more than £1 million, but there’s also been a dip in the average house price at this level for two years in a row."
The increase in sales from 5,946 in H1 2015 to 6,684 in H1 2016 more than offset the 6% fall between H1 2014 and H1 2015.
However, the 6% increase overall between H1 2014 and H1 2016 contrasts with growth in million pound sales over the past 5 and 10 years of 88% and 162% respectively, indicating a significant slowdown over the past two years.
Nonetheless, the prime market has outperformed the rest of the market, with sales of houses under £1 million recording only a 2% rise from H1 2015 to H1 2016.
Despite the growth in the number of sales of million pound houses during the last year, the average price for houses sold for over £1 million has fallen for two consecutive years, from £1,862,578 (H1 2014) to £1,727,327 (H1 2016) – a fall of 7%.
The additional 3% stamp duty rate for second and buy to let properties may have contributed to the acceleration of sales in this period.
In the first half of 2015 there were three ‘million pound towns’ in Britain – where the average price of all sales is over £1m: Virginia Water, Cobham and Beaconsfield. The recent fall in the average price of homes sold for more than a million pounds has left Virginia Water in Runnymede, as Britain’s only ‘million pound town’. The average price in Britain’s most expensive town outside London is £1,082,286.
The second most expensive town is Cobham in Surrey, where average house prices fell by 5% to £987,836 in H1 2016 – taking it just below the ‘million pound town’ status it held in H1 2015.
In Scotland, sales of £1 million pound houses fell by a third, from 120 (H1 2015) to 81 (H1 2016).
Sarah Deaves, Private Banking Director at Lloyds Bank, commented: “Over the last year, there’s been an increase in the number of houses being sold for more than £1 million, but there’s also been a dip in the average house price at this level for two years in a row. The strength of the London economy, stamp duty changes and the attractiveness of UK prime property to overseas buyers, could all play a part in the boost to sales at this level.
“Due to a reduction in the average prices for all those homes sold for more than £1 million, Virginia Water in Surrey is now Britain’s only ‘million pound town’. In the first half of 2015, it was one of three towns with this status.”
