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London’s super-prime property market shows signs of recovery

EdgeProp Singapore |

June 22, 2021 6:15 PM SGT

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SINGAPORE (EDGEPROP) - London’s super-prime property market has shown signs of recovery as the UK’s Covid-19 vaccination programme gathers pace and expectations grow that travel rules will be relaxed in the coming months. (See also: Stamp duty holiday in UK spurring residential transactions by Asian investors in London)

In the six months to end April, GBP817.4 million ($1.53 billion) was spent on London super-prime property, 21% higher than the figure of GBP677.9 million recorded during the preceding six months, highlights Knight Frank in a report.

Over the six months to end-April, there were a total of 45 super-prime deals, compared to 43 transactions in the preceding six month period.

Despite international travel restrictions, worldwide demand has continued and far exceeds supply, says Knight Frank. The number of new prospective super-prime buyers was 150% higher in May than it was in January 2020. And over the same period, the number of new property listings in the super-prime category fell by 25% as owners hesitated against the backdrop of the pandemic.

On a 12-month rolling average, there were 8.7 new buyers for every new super-prime property listed for sale in May.

Super-prime prices also rose 0.6% on average in the year to end May, which marked the first rise in over three years.

“The London super-prime market is seeing a surge of interest. Purchasers with a combined budget of GBP36.8 billion are actively searching for £10m+ properties right now, representing a rise of 54% compared to the five year average,” comments Liam Bailey, Knight Frank’s global head of research.

“A combination of lockdown easing, a rapidly growing economy, sharply improved business sentiment, and a sense that city living is being reignited after a long close-down is helping to drive buyers,” he adds.

“While the figure represents a growth in new demand from new UK and international buyers, there is also a growth in demand from existing luxury home owners looking to buy a new, bigger, better, super-prime home to improve and expand their London base, as a response to Covid’s impact on their lifestyle,” says Bailey.

“Apart from domestic sales, we are also witnessing a surge in transactions from Asia-Pacific buyers in the recent months as they become more aware that the currency discount is starting to narrow as the pound strengthens on the back of the UK’s vaccine-fuelled economic recovery,” says Victoria Garrett, Knight Frank’s head of residential, Asia-Pacific.

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