It means that values have risen by almost 13% over the past 12 months and are now at a record high, some 40% above their post credit crunch low of March 2009 and 6% above their previous peak of March 2008.
Properties in the £2.5 million to £5 million bracket saw the strongest annual growth of 16%. Those in both the sub-£1 million and the plus £10 million brackets grew by just under 12%.
On average, properties in the index are worth £3.19 million. This means that a typical prime London property has risen in value by more than £1,202 per day over the past year.
A £1 million flat purchased in November 2010 will have increased in price by around £395 per day. Those fortunate to have bought a £5 million property will have seen price growth equivalent to £2,205 per day.
Knight Frank points out that this growth has taken place against the backdrop of ever worsening global economic news and rising threats of a second credit crunch.
Our analysis of market activity in the three month period to November, compared to the same period in 2010, confirms a positive picture of demand and sales activity, demonstrating that the increasingly apocalyptic news headlines are not having a significant impact on the prime London market.
Sales volumes are running 17% higher than a year ago, although this is driven purely by the sub-£5 million market, which is up 20%. Though the £5 million market has been relatively flat, sales subject to contract are up 28% year on year in this bracket.
On the demand side, new applicant registrations are up 12% over the year, 6% for the sub-£5 million market and 40% for the £5 million market. This positive reading is more than matched by supply, where new instructions to sell are higher by 15%, 10% sub-£5 million and 44% over £5 million.
Though stock levels are rising, the ratio of new applicant registrations to new instructions has slipped only very slightly, from 4.2 in late 2010 to 4.1 in November this year.
‘Despite growing global economic instability, our forecast for the prime central London market in 2012 is for positive price growth, but at a slower pace than we have seen over the past two years. We are expecting a rise of 5% across the whole of next year,’ the report says.
