Sales of million pound plus properties outperforming the rest of the market

The market for homes worth a million pounds or more in England and Wales has increased with sales recorded by the Land Registry to within just 6% of the 2007 peak, new research shows.

In sharp contrast, sales in the overall housing market remain some 45% down on pre crunch levels, according to an analysis of the figures by real estate consultants Savills.

London dominates the market in this price range. The capital accounted for two thirds of the total 7,734 £1 million plus sales in England and Wales. Last year alone the number of £1 million plus transactions in the London region rose by 7.8%, to close the year 8% above peak.

Savills says that the figures demonstrate the widening regional gap in the prime housing markets of the UK. Whilst there have been some encouraging signs at the beginning of 2013, wealth has been slow to flow out of London into the commuter zone. Beyond these areas, the weak economic recovery has hampered the £1 million plus regional markets of the Midlands and the North of England.

Together, London and the South East account for almost nine out of 10 sales at or above £1 million at 87.2%, even though sales in the South East are down 23% on peak levels. By contrast, the Midlands and Wales, the North West, North East and Yorkshire and The Humber combined account for just 258, or 3.2% of all high value sales, having slipped by around 57% since peak.

Within London, six boroughs dominate. Kensington and Chelsea has 19% of sales in this price bracket followed by the City of Westminster with 18%, Hammersmith and Fulham with 9%, Wandsworth and Camden both with 8%, and Richmond  with 7%. Together they account for over 50% of all £1 million plus sales in England & Wales.
 
Localised analysis suggests that the recovery in £1 million plus transaction levels has been driven by the continued growth in sales in areas of London which have become gentrified in the past 10 years or so, whilst prime properties in more mature core central London locations breached the £1m price barrier before 2007.
 
Areas such as Southwark, Hammersmith, Battersea and Islington have seen very strong growth in the £1 million plus sales reflecting the expansion of the prime market of London.

Beyond London, sales in the 10 counties with the highest levels of £1 million plus properties have struggled to recover to their 2007 level. Oxfordshire is the only county to have seen growth, with £1 million plus sales up 21%, to 142 in 2012, a reflection of the increasing appeal of Oxford and the wider county. At the other extreme, Manchester volumes are down by 68%.

Few city locations outside of London have recorded double digit £1 million plus sales increases since 2007. Standout performers include Oxford up 129% to 214, Brighton and Hove up 52% to 139 and Cambridge  up 32% to 153.