British households have experienced the steepest decline in personal wealth among advanced economies since the COVID-19 pandemic, according to a new report by Swiss bank UBS, highlighting the lasting impact of high inflation, rising living costs and a cooling housing market.
The study found that the median wealth of adults in the UK has fallen by more than 23% in real terms since 2020 after adjusting for inflation. UBS estimates that the average Briton has lost around £28,500 in wealth over the past five years, leaving the typical adult with assets worth just over £95,500 in 2025.
The report compared wealth across 37 countries and concluded that no other advanced economy recorded a larger decline during the period. Britain’s performance also lagged behind several emerging economies, including Turkey, Bulgaria, Mexico and Kazakhstan.
UBS measures wealth by assessing the value of assets such as homes, investments and financial holdings. The bank said soaring inflation significantly reduced the real value of those assets, particularly following the economic disruption caused by the pandemic and higher global energy prices after Russia’s invasion of Ukraine.
Chief Economist Paul Donovan of UBS Global Wealth Management said Britain’s inflation spike had been more severe than in many European countries, largely because of the structure of the UK’s energy pricing system.
“The UK had a brief period of notably higher inflation than Europe did, and that has distorted the real numbers,” Donovan said. “You had a couple of years of quite high inflation, partly because of the various peculiarities of our energy pricing structure.”
The housing market also contributed to the decline. While UK house prices have increased by about 26% since the beginning of 2020, consumer prices have risen by approximately 32% over the same period. As a result, homeowners have seen the inflation-adjusted value of their property wealth decline despite higher nominal prices.
Donovan noted that residential property remains the largest asset held by most households, making housing market performance a major factor in overall wealth levels.
The findings come as political leaders continue to debate living standards and economic growth. Andy Burnham, who is preparing to become the UK’s next prime minister, recently pledged to reverse years of stagnant living standards, saying the country could not afford another decade of weak household prosperity.
Separate figures released this week by the Office for National Statistics also showed that living standards remain below levels recorded before the current government took office.
Business groups have echoed concerns about the economic outlook. The Institute of Directors reported a further decline in business confidence during June, with Chief Economist Anna Leach calling for measures to reduce regulatory costs, simplify the tax system and provide greater policy certainty to encourage investment.
The Treasury defended the government’s economic strategy, pointing to stable inflation, stronger wage growth and improved forecasts from international organizations including the International Monetary Fund and the Organisation for Economic Co-operation and Development.
Despite those signs of improvement, the UBS report suggests many British households continue to feel the long-term effects of inflation, with accumulated wealth yet to recover from the economic shocks of recent years.
