Britain’s richest households have pulled further ahead of the rest of the population as house prices have accelerated, with the top 10% now owning almost half of the country’s £11.1tn total private wealth.
The Office for National Statistics (ONS) said average household wealth was £225,100 in 2012-14, when it carried out its latest survey of the nation’s assets.
Since the previous survey was carried out two years earlier, the top tenth of households had seen a 21% increase in their wealth, including property. Over the same period, the poorest half of households also saw their wealth rise — but only by 7%.
That left the top tenth of households owning 45% of total wealth, while the bottom half were left with just 9%.
Duncan Exley, director of the Equality Trust, said: “When such a huge chunk of the country’s wealth is found in the hands of so few people, it is clear something has gone terribly wrong. Aside from the disproportionate power this provides the richest, we know this vast inequality also weakens our economy and damages our society.”
The ONS asked Britain’s families about their savings, share portfolios and housing wealth. They found that the top 10% owned at least £1,048,000 in assets, while the bottom 10% owned £12,600 or less. This underlined the gulf that separates the wealthiest, who tend to own their own homes, and the poorest, who have little or no nest egg set aside for the future.
The ONS found that private pension portfolios accounted for 40% of households’ total wealth. The median household private pension wealth for the top tenth of the population was £749,000, compared with £2,800 for households in the least wealthy half of households.
Examining the regional distribution of wealth, the ONS found that it is heavily concentrated in London and the south-east, where the housing market has bounced back strongly since the slump that followed the global financial crisis.
Total property wealth in Britain, net of mortgages, increased by almost £400bn over the two years between its latest wealth surveys, the ONS found.
Mark Posniak, managing director of Dragonfly Property Finance, said: “In 2014, Finland’s GDP was £184bn, which means Britain’s property market is effectively an economy in itself. UK homeowners have been able to sit back while their properties, collectively, generate more cash than entire countries.”