London has long been the global epicentre of luxury property sales but the capital’s share of the international super-prime market took a hit in the first few months of this year.
According to recent data by Knight Frank, sales of $10 million-plus homes spiked across global financial centres in the first quarter of 2023 with Dubai and Hong Kong top of the table.
But in London, super-prime sales got off to a slow start. In the capital, just 36 $10m-plus homes were sold in the first quarter, compared to 88 in market leader Dubai, 67 in Hong Kong and 58 and New York.
According to agents this recent slump is a result of rapid interest rate rises and the lingering effects of former prime minister Liz Truss’ mini budget.
“London was hit by the speed of interest rate rises in the final quarter of 2022 and also by the hangover from the ill fated mini-budget last year – all of which weighed on demand in the first three months of this year”, said Liam Bailey, Global Head of Research at Knight Frank.
But while London’s global standing might have dipped, its firmly expected to bounce back. Last year the capital’s super prime market had its strongest year since 2016, when the Brexit vote put off investors from buying in the capital.
A combined total £3.1 billion was spent on 161 super-prime properties in the year to March 2023, according to Knight Frank.
The highest number of £10 million-plus deals in London took place in Kensington (26), followed by Belgravia (25) and Mayfair (22). One of the standout sales was to Swiss billionaire Ernesto Bertarelli, who splashed £92 million on a 19th century Belgravia mansion with 82 rooms.
In 2022, sales of £5m plus homes also hit a record high. According to data from Savills, 606 properties sold in this bracket, with a total value of £6.57bn
Bailey said the “longer view” shows London was the second strongest market over the most recent 12-month period and as the summer selling season opens up agents are seeing strong interest in London’s super-prime stock.
High-value sale have been made in recent months, including a “substantial” unmodernised house on Belgravia’s Eaton Place, one of the UK’s most expensive streets.
The property, which had a £17.5m price tag and attracted multiple bids, consisted of the main house along with a mews property that can be remodelled to create a 9 bedroom house, with a lift, 4 reception rooms, family and catering kitchen, gym, media room, double garage and terrace.
A £19.9m penthouse in Knightsbridge, also marketed by Knight Frank, was snapped up in March, with views over Hyde Park and the Serpentine, in addition to a secluded and large secluded roof terrace.
Savills also sold two luxury homes both above £14m price tags, a modern 4,672 sq ft townhouse in Kensington’s De Vere Conservation Area with a 43ft back garden. The second was a classic town house in Chester Terrace overlooking Regents Park.
According to Knight Frank, the latest super-prime figures confirm the arrival of Dubai as a “key market” for the world’s wealthy, but also point to the “ongoing centrality” of London, New York and LA.
Bailey added: “London’s share of global super-prime sales fell in the first quarter of this year, partly as a result of a very strong showing in Dubai and also Hong Kong – both markets which have seen strong activity driven by newly wealthy buyers.
“Super-prime residential property has retained its attraction for wealthy buyers despite huge economic headwinds. The data for the first quarter of this year confirms an ongoing desire for new $10m+ purchases at a time when markets were clouded by peak uncertainty around global inflation and interest rates.”
