Chancellor George Osborne is to deliver a Budget tomorrow which will take family homes worth £1m out of inheritance tax.

A report by NFU Mutual said 30% of homes in the UK could be undervalued, and the new rules will lead to a rush to revalue property.

Families in many areas of the South East, plus Gloucestershire, Dorset and Cheshire, are expected to lead the charge to revalue their homes, although warnings have been issued about problems this could create.

Revaluation could lead to increased council tax and more expensive bills for insurance, particularly for homes which are listed.

Around 80% of million pound homes sold in England and Wales in the last 15 years are located in London and the South East.

Nicki Whittaker, high-value home specialist at NFU Mutual, said: “If you don’t know how much your home is worth, then there’s a real danger that you and your family could lose out. Around three in every ten homes are undervalued by their owners, leaving families at risk of underinsurance and an unexpected tax bill.

“We expect there will be a rush to re-value these properties as parents and grandparents look to hand down as much as they can to their families.”

He added: “Figures from our valuation partners show many expensive country homes are dramatically undervalued because owners are often unaware that the cost of rebuilding listed and unique properties is so much greater.

“It’s clear from these results that thousands more people need to take action if they want to make sure their biggest financial asset remains in the family. A valuation and some simple tax planning would help to make sure people are fully protecting what is rightfully theirs.”

Top five counties for properties worth £1m (outside London and the South East):

1) Dorset

2) Gloucestershire

3) Yorkshire

4) Cheshire

5) Somerset