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Rich Get Poorer As Millionaires’ Assets Plummet

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Rich get poorer as millionaires’ assets plummet

The number of millionaires in the UK has more than halved since 2007 as house prices, share values and bonus payments have tumbled.

About 242,000 people now have assets of more than £1 million, down from 489,000 in 2007, according to estimates from the Centre for Economics and Business Research (CEBR). Millionaires have seen nearly a quarter of their wealth wiped out over the past two years. The CEBR does not expect the number of millionaires to rise again until 2011.

The figures come weeks after it emerged that the super-rich have also been hammered by the recession, with the number of billionaires in the UK falling from 75 to 43 last year.

The Sunday Times Rich List also showed that Britain’s wealthiest 1,000 people lost a total of £155 billion from their fortunes last year, equalling more than a third of their total worth.

The damage is not confined to the wealthy or super-wealthy. Economists at Capital Economics calculate that the fall in house prices has dragged down total housing wealth in the UK by £750 billion. Financial assets, two thirds of which are made up of shares, have fallen by an additional £1.2 trillion, wiping about £2 trillion from household wealth in the UK.

The CEBR said that while millionaires have seen a smaller slice of their wealth eroded than the super-wealthy, they have been hit harder by the property slump. “Billionaires have less than 10 per cent of their assets in property, whereas the average millionaire in 2007 had 42 per cent of assets in property,” Doug McWilliams, the CEBR chief executive, said.

House prices are nearly 20 per cent lower than they were when the market peaked in October 2007 and could fall by a further 15 per cent, analysts say. That has reversed the trend in the years between 2003 and 2007, when house prices boomed, pushing the number of millionaires from 230,000 to 489,000.

The wealth of many millionaires has also been dented by the big reduction in bank bonuses and tumbling share prices. The average bonus paid to those working in the financial sector dropped by nearly 60 per cent in February — the traditional month in which bonuses are paid — according to recent official figures.

I would imagine a lot of these folk were heavily leveraged in property.

Bummer.

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Rich get poorer as millionaires’ assets plummet

I would imagine a lot of these folk were heavily leveraged in property.

Bummer.

Did you watch that Eire TV prog from the thread on it - had some bloke in it who had a property empire worth 24 million Euros on paper and who now is about to lose his own house plus his BTL empire.

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I thought that in order to be a millionaire you actually had to have a million pounds i.e. £1,000,000

So the only way to stop being one would be to spend it?

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I read that Sunday Times article.

It seems, even if we do use their back of a fag packet calculations, that the rich smart folk have lost more of their wealth than the average Joe... :rolleyes:

I have stated this numerous times to people. I seriously think there are only 2 things you need to have a good chance of being an Entrepreneur like savvy investor.

(1) A desire for more and more money.

(2) An acceptance to happily work stupid hours every day for that one end goal.

Nothing wrong with that. We are all different afterall. However I don't like the way these people are all classed as inspiration for the rest of us. Many of them are clearly dumb as ******. Spending 30 years of your life working 80 hours a week for your fortune. Only to lose half of it in the space of 12 months because you couldn't see this shit coming ? Hardly the sharpest tools in the box.

Edited by ccc

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So its confirmation that Hpi is only good for the rich at the expense of the poor. So am I a millionaire if I borrow a million?

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The Times Rich List shows 34% of UK's 100 richest people have 'property' as a principal asset.

And that is the problem, no innovation to bennefit the country just property speculation.

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http://news.bbc.co.uk/1/hi/business/8068967.stm

The number of UK millionaires has more than halved as the recession has bitten into the earnings of the super-wealthy, a report has claimed.

There are now 242,000 millionaires across the country, down from a peak of 489,000 in 2007, said the Centre for Economics and Business Research (CEBR).

The CEBR said the big decline had been caused by the collapse in the property market and stock market falls.

This year's 70% drop in City bonuses was another factor, it said.

'Only just millionaires'

The report added that another factor that explained the sharp decline was that "a very large number" of previous millionaires had only just crept above the £1m wealth threshold because of the rising property prices of recent years, which have now fallen back sharply.

"Having just crept over the threshold, most of these people have crept back under it again - many, perhaps, without ever knowing that they had become millionaires for a temporary period," it said.

The CEBR said the decline in the number of millionaires could be seen in the recent reduction in the sale of luxury items, such as Bentley cars, sales of which have fallen 66% so far this year.

However, the CEBR concludes that the number of UK millionaires will start to rise again from 2011 as the property market recovers.

Excellent will this be down to the 3% growth the country is experiencing in 2011.

Property prices collapse and millionaires disappear.

Please someone rescue HPI this country needs it. :angry: :(

We are screwed.

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millionaires on paper.

shame they cant spend it without borrowing.

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I am not sure of the objective measure of millionaires. The mention assets, but don't say net assets.

I guess I may be on my way to falling into this group come the next boom. I reckon my total networth is about £500k, so I am sure once there is eventually an inflationary holocaust I'll have £1m, though by then a loaf of bread will be £100.

Edited by mikelivingstone

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Presumably there were even fewer millionaires a few months ago when the stock markets were right down.

But my big pondering question that floated to the surface is this:

How many debt-millionaires are there in this country?

Edited by blankster

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