Value of UK homes up 9% to �4trillion

[Marquis Of Brown]

Highlighting this extract from the article copied below from 
Saturday's Guardian: >'The figures will provoke renewed calls from 
campaigners and economists, who argue Britain should introduce a tax 
on the value of land to prevent surges in house prices and encourage 
Britons to invest in productive assets rather than property.'

Housing reports show UK homes top £4tn
The Guardian, 
Saturday January 12 2008
Ref: http://www.guardian.co.uk/business/2008/jan/12/
housingmarket.houseprices

The total value of Britain's housing stock jumped 9% to a record £4 
trillion last year and has trebled over the past decade, Halifax says 
today.

This puts all private houses and flats at a combined value of three 
times the annual output of the British economy. That value rose by 
£320bn last year - three times the National Health Service budget.

The Halifax's annual report presents the other side of the relentless 
rise in household debt in Britain, which has increased to record 
levels of more than £1.3tn.

In fact, housing equity - the value of housing assets less 
outstanding mortgage balances - has increased by nearly £2tn over the 
past 10 years, from £870bn in 1997 to £2.8tn in 2007. 

The lender said the new £4tn value of private housing stock was 3.4 
times the value of outstanding mortgage debt, which was £1.2tn at the 
end of 2007. Housing assets have increased by more than mortgage debt 
in each year since 1995.

Halifax chief economist Martin Ellis said: "UK homeowners have 
collectively accumulated an extra £2tn of equity in their homes over 
the past decade as property prices have risen. This has significantly 
strengthened the household balance sheet. Mortgage debt accounts for 
only 30% of the value of the UK's £4tn worth of housing assets."

The research showed that England's north-south divide held steady 
last year. The total value of private housing in the south is worth 
£2.2tn compared with £1.8tn in the north, but the south's share of 
housing assets was unchanged at 55%. 

Each region of Britain has seen at least a 180% increase in the value 
of its housing stock since 1997. The biggest increases are in 
Northern Ireland (404%), Wales (223%) and the south-west of England 
(222%). Six regions of the UK have a housing stock worth at least 
£250bn; a decade ago it was only the south-east of England.

Halifax said 36% of the value of the UK's private residential housing 
assets is concentrated in the south-east of England (19%) and greater 
London (17%). Scotland saw the value of its housing stock rise the 
fastest last year, by 16%, followed by Northern Ireland with 15% and 
the east Midlands with 12%. The smallest increase, of 5%, was in 
Yorkshire and the Humber.

The figures will provoke renewed calls from campaigners and 
economists, who argue Britain should introduce a tax on the value of 
land to prevent surges in house prices and encourage Britons to 
invest in productive assets rather than property. 

In spite of the recent fuss about inheritance tax, that and stamp 
duty on housing raised only £9bn last year.

Economists say that rising house prices do not make an economy richer 
- they merely represent a transfer of money to the older generation 
who own property, from younger people getting on to the housing 
ladder and even people not yet born, who will face higher prices when 
they eventually come to buy a home.