Rising house prices lead to highest number of UK millionaires on record, with nearly half living in London and the South East

The UK is now home to 625,000 millionaires - the highest number on record - with one in 79 Britons aged 21 or over worth at least £1 million.

The increase, up 44,000 on last year, has been attributed to the continued rise in house prices throughout the country, with nearly half of all millionaires living in the most expensive regions, London and the South East, according to Barclays Wealth's UK Prosperity Map.

Every UK region boasts more millionaires than it did 12 months ago bar Scotland, where the number has fallen by 2,000 since 2010 thanks to effect of the oil industry crisis on unemployment and house prices.

Dena Brumpton, chief executive of wealth and investments at Barclays, says that a millionaire is defined as an individual worth more than £1 million, net of liabilities, factoring in all investable assets including cash, savings, equities, mutual funds, fixed income, pensions and property.

"Rising house prices do have the potential to make millionaires of those who have a house worth £1 million or more - but only if they've paid off their mortgage," she said.

"It's interesting to see that the regions that have seen the greatest advance in millionaire numbers, namely the East Midlands and South West, have both seen healthy uplifts in property prices. The regions that have seen lower growth in millionaire numbers - for example, London - have typically experienced slower house price growth over the same period."

Nevertheless, London, where the average house price is £482,000, remains the most prosperous, with 165,000 millionaires living in the capital (26.4 per cent).

Cities are outpacing their wider regions in terms of prosperity. Almost every city has enjoyed bigger house price growth than the capital's three per cent increase, with Birmingham proving a particular hot spot (up eight per cent).

The South East, where the average house price is £320,000, has the highest number of millionaires after London, with 130,000 (20.8 per cent) living there and house price growth of five per cent.

The North East is at the other end of the scale, with just 12,000 millionaires (1.9 per cent), but the average house price in the area is £130,000 and house price growth is at four per cent.

Savills estate agent recently revealed that the number of UK homes worth at least £1 million has doubled in the past decade to almost 400,000.

Frances Clacy, research analyst at Savills, commented on the latest news: “Over the past 10 years, the number of British homes worth in excess of £1 million has more than doubled, despite a small fall of 3.4% in 2016.

"We estimate that there are now some 394,000 properties worth more than £1m across the UK, largely driven by price growth in London and its fringes.

"A large proportion of household wealth can be attributed to equity from housing, so the strong levels of house price growth seen in the capital over the past ten years will have undoubtedly made a significant contribution to the rise in the number of millionaires."