This sector of the market has recovered strongly since the post economic crisis lows in March 2009 and prices have increased in value by 42% and are almost 18% higher than the previous market peak in August 2008.
According to Tim Wright and Richard Cutt, who run Knight Frank’s Prime Residential Team, this rapid rebound in property values has been underpinned by the continued demand for the very best homes from both international and domestic buyers. Since 2009, some 33 different nationalities have purchased super prime homes in central London.
‘There is a common misconception that the super prime market is saturated with overseas buyers. In fact nearly a third of all super prime properties have been purchased by UK buyers since the start of 2012,’ they said.
Russian buyers, the next most active purchasers, had a market share of 21% over the same period, followed by Europeans who accounted for 15% of all £10 million plus sales.
‘That’s not to say we haven’t seen an increased interest in London’s very best homes from a diverse range of nationalities. Since the onset of the financial crisis, many of the world’s wealthy view the super rime property market in London as a safe haven, appreciating its stability, as well as its ability to deliver capital growth, compared with other more volatile markets which have not weathered the crisis so successfully,’ they added.
The weakness of sterling has also played a part in making London property even more appealing to international buyers, who are able to take advantage of effective currency discounts when buying a home.
More recently, Indian as well as Middle Eastern buyers have displayed a renewed interest in super prime homes.
‘Another interesting trend we have noticed is the beginning of a blurring of London’s super prime boundaries,’ the analysts said.
They pointed out that the market has traditionally focused around a small cluster of central postcodes including Knightsbridge, Mayfair and Belgravia. But as prices and competition for homes increase, buyers are seeing the untapped potential of homes in markets that adjoin these traditional areas, such as Marylebone and Hyde Park.
