UK £10tn worth largely comes from land value

News


06 Dec, 2017

UK £10tn worth largely comes from land value

The UK’s worth grew by the biggest amount to £9.8tn by the end of 2016, boosted by land value, which has grown "more than fivefold" since 1995, according to official data.

Combining the UK’s total assets, the Office for National Statistics (ONS) found that the UK’s value increased by 8.9% or £803bn between 2015 and 2016. The country’s net worth has risen progressively since 2012, following a course in line with pre-financial crisis conditions.

Land was found to be the UK’s most valuable asset, making up more than half of the UK’s total net worth, according to yearly ONS figure which estimate the market value of UK assets known as the national balance sheet.

Non-financial assets increased by £477bn in 2016, with £280bn of that growth coming from rising land value. Land is worth £5.0tn, equivalent to 51% of the total value of the UK.

However, the growth of land value slowed last year to a 5.9% increase, compared with rises of 15% in 2014 and 10% in 2015.

The ONS acknowledged that land valuations remain highly dependent on house prices. In 2008 land lost 23% of its value, some 23%, as the housing market tumbled. For several years ahead of the crash, land as an asset grew by 18.3%.

The Government was the least valuable sector in the UK, with a value of negative £845bn. This was driven by central government's massive debt. It was £1.2tn in the red, contrasting with local government which was £356bn in the black.

Daniel Groves of the ONS said: “Since 1995 the value of land has increased more than fivefold, making it our most valuable asset. At £5tn, it accounts for just over half of the total net worth of the UK at end-2016.”

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