Property values drive Midlands prosperity to new heights
THE Midlands is more prosperous than it was a year ago, according to a new study.
Despite uncertain economic conditions during the year caused by volatile stock markets, China’s slowdown and the lead up to Brexit, Barclays’ Prosperity Index showed an overall uplift in prosperity in the Midlands in comparison to last year’s study.
The research uses factors including numbers of millionaires, average annual pay, the percentage of households giving to charity, business growth rates and exam scores to generate a unique ‘Prosperity Index Score’ for each UK region.
The research revealed that prosperity in the Midlands has been boosted by a strong housing market. The average house price in the East Midlands is £159,222, and £158,858 in the West Midlands which are the fifth and sixth highest in the UK.
Prices have risen by 5% and 4% respectively since last year, outpacing growth in the North of England, Scotland and Wales. House prices in Birmingham rose by 7%, a fraction behind Manchester, making it one of the five cities with the largest house price growth in the research.
The Midlands also continues to host a thriving SME scene which has played an important part in the region’s prosperity. The region’s small businesses have expanded their turnover by 3% in the West Midlands and 5% in the East Midlands compared with last year, and growth in Birmingham is equal to that seen in London at 7%.
GDP per capita grew faster in the Midlands than in London, rising by 10.7% in East Midlands and 11.5% in West Midlands, compared to just 8% in London. Meanwhile, unemployment reduced by 0.9% and 1%, respectively, contributing to the growing prosperity in the region.
The Midlands is also home to 57,000 millionaires (32,000 in the West Midlands and 25,000 in the East Midlands) and the East Midlands and West Midlands are two of only five regions where the number of millionaires remained static.
There are now 690,000 people in the UK who are worth at least seven figures, this is the equivalent of one in every 67 people being a millionaire. Although this is a slight dip in comparison to 2015, falling by 3.8%, the longer term trend paints a better picture, with the number of millionaires increasing by 34% since 2010.
Even without London and the South East, the rest of the UK has shown an increase of 85,000 additional millionaires, up by 31% since 2010.
In the rest of the UK, every region has become more prosperous than last year, with uplifts in either household wealth, GDP, household expenditure or earnings, and a decrease in unemployment.
Paul Keiser, Regional Director in the Midlands, Barclays Wealth and Investment Management, said: “It is very encouraging to see that prosperity in the Midlands is on an upwards trajectory, with our region’s innovative entrepreneurs playing a vital part in supporting our growth. The fact that Birmingham’s SMEs are now growing at the same rate as those in London demonstrates that we are ready to compete with the capital when it comes to providing the right conditions to start and grow a successful business and drive prosperity more widely.
“With positive growth in prosperity recorded across the country, it is clear that our region is playing a key role in this trend. It is more important than ever that business leaders and policy makers continue to create new opportunities to keep our region, and the UK as a whole, ‘open for business’ and continuing on this trajectory.”
