MORE than 200 people per day became property millionaires in 2015 – that’s 76,000 new property millionaires in a year. And every one of those properties needs the best home insurance possible to protect it against financial loss.
2.2% of owners are property millionaires
Most of these new property millionaires are in London or the South East of England where property prices seemingly ignored the last recession and kept growing. Hoopla is the property website that carried out the survey and it means 2.2% of all homeowners now own a million pound plus home.
Being a property millionaire doesn’t necessarily mean you are on easy street though. High mortgage costs are not factored into the stats and it is a paper value only. A new stamp duty law is also deflating the price of £1million+ homes as anything over this value now faces huge charges.
High demand and low supply push up prices
The simple fact is though, that as long as demand remains high, particularly around London, then house prices will increase. And if a two bed flat costs £500,000 now, it is easy to see why a four bed detached in the same area, however modest, will attract £1million + valuations.
It’s good to know that home insurance for this properties is not difficult to get. It’s not the retail value of the property that you need to worry about, it’s the rebuild value that is important. A £1million four bed property in London may only cost £200,000 to rebuild, so the cost of the home insurance will be incredibly reasonable by comparison.
Home insurance for £200
A typical home insurance that includes buildings and contents insurance costs around £200 per year in the UK as a whole. That could mean your million pounds home is covered against complete rebuild for £200 and that sounds excellent value to me.
And as usual the media headlines proclaiming massive property values doesn’t really help anyone who wants to buy or sell a property. Sure, we might feel a bit better about ourselves if we own such a property, but how hard are we working to try and buy it? With the prospect of increasing interest rates and an active moveably the Government and Bank of England to cool the housing market, it could be some time before you read these headlines again. And no-one likes to be told their properties are worth less but that is on the horizon.
Either way, if you want low cost, high quality home insurance, then try The Property Insurer, the UK’s specialist home insurance provider.