What market crash? Super-prime sales hit record high

Home sales and house prices may have struggled in 2023 but more affluent buyers and sellers may not have noticed.

Analysis by Beauchamp Estates shows Mayfair super-prime home sales for properties valued at above £10m, has boomed during 2023, with twice as many homes sold than in 2022.

This generated combined sales of £313m, triple the equivalent value of £123m a year before.

Beauchamp Estates said the Mayfair super-prime residential market has been driven by American and Middle East buyers, in particular clients from Saudi Arabia and the UAE, who have purchased through Beauchamp Estates more than £80m worth of homes in Mayfair in recent months.

Gary Hersham, founding director of Beauchamp Estates, said: “During 2023 the Mayfair super-prime housing market has boomed, Mayfair is currently the most sought after address in Prime Central London for wealthy home buyers from around the world.  

“Beauchamp Estates has completed a dozen big deals for super-prime homes in the district over the last few months with most of our clients choosing to purchase large lateral apartments. The £10m plus deals landscape in Mayfair has been dominated by American and Middle East buyers who have undertaken cash purchases and taken advantage of preferential exchange rates for dollar buyers.” 

Jeremy Gee, managing director of Beauchamp Estates, added: “Two major wars and the poor performance of alternative investment markets has encouraged multi-millionaires and billionaires to return to investing in London residential real estate which is a proven safe haven and stable asset class.

“ Mayfair and Hyde Park have been the most popular destinations for overseas buyers from the USA and Middle East looking for homes in the UK capital. Due to the quality of lifestyle, education and stability, London is seen as a safe haven for global capital and remains one of the most desirable locations in the world for multi-millionaires and billionaires to buy or rent a home and spend their time.”

It comes as analysis by Knight Frank shows the number of sales above £10m in the capital has hit an eight-year high, although political risks remain.

Rory Penn, head of London sales at Knight Frank, said: “There are two reasons driving London’s strong performance.

“First, its enduring appeal as global ‘super city’ alongside New York, Paris, and Singapore – London remains front and centre on this list, Brexit or not. The other reason, often overlooked, is financial. 

“Clients can buy a trophy home in most PCL postcodes at the same price, or lower, than around 10 years ago. London is showing genuine value at what could be the low point in a 20-year cycle.”

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Meanwhile, analysis by Savills shows prime regional house prices fell by just 0.8% during the final quarter of 2023.

That is an improvement on the 1.5% decline seen in both the second and third quarter of 2023.

This leaves values down 4.8% year on year and 6.1% from their third quarter 2022 peak.

Frances McDonald, director at Savills residential research, said: “The source of buyers’ funding has become a key determinant in the performance of micro markets.

“Broadly speaking, the prime markets are less reliant on borrowing than the mainstream and more responsive to sentiment. 

“These results point to a market that has all but levelled out, something that could happen in the first few months of 2024, ahead of their mainstream equivalents, unless we see a major shift in policy.”