Pensions and property help boost household wealth

Households have seen a £1.7 trillion boost to their total net wealth between 2012/14 and 2014/16, largely due to the rising value of pensions and property, according to Office for National Statistics (ONS) figures.

The ONS's Wealth in Great Britain report showed total household net wealth was £12.8 trillion in 2014/16, up 15% compared with 2012/14 when the total was £11.1 trillion.

Median average household net wealth was £259,400 in 2014/16.

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But there has been "little change" in the proportion of total wealth held by wealthier households compared with less wealthy households between 2012/14 and 2014/16, the ONS said.

The wealth held by the top 10% of households was around five times that of the wealth of the bottom half combined.

In 2014/16, the wealthiest 10% of households held 44% of wealth, while the bottom half held 9%.

The majority of the wealth boost generally seen in recent years is due to growth in private pension wealth and net property wealth, the ONS said.

Total private pension wealth increased by 20% from £4.4 trillion to £5.3 trillion between 2012/14 and 2014/16 - although around a third of this increase was due to market factors rather than people ploughing more cash into their pensions.

In 2014/16, 49% of people aged 16 to 64 years had some form of active private pension that they were contributing to, up from 44% in the previous period.

Net property wealth increased by 17% from £3.9 trillion in 2012/14 to £4.6 trillion in 2014/16.

The ONS said the 17% increase was record growth - and was driven largely by increases in net property wealth in London.

Median average net property wealth in London was £351,000 in 2014/16 - an increase of a third (33%) from 2012/14.

However, the least wealthy 10% of households in Britain had negative net property wealth in 2014/16 - meaning their liabilities outweighed their assets.

Meanwhile, households' total debts stood at £1.23 trillion in July 2014 to June 2016, marking a 7% increase on the previous two-year period.

Within the total, £1.12 trillion was mortgage debt, marking a 6% increase on the previous period, and £117 billion was financial debt such as credit cards and loans, showing a 15% increase.