Demand for luxury apartments soars in parts of UK, particularly London
The number of million pound apartment sales in England and Wales has grown nearly threefold, up 196%, in the last decade, according to new research.
The rate of sales growth for apartments has far outpaced other prime market property types with sales of million pound terraces rising by 165%, followed by semi-detached properties up 154% and detached homes up 88%.
The research from Lloyds Private Banking also shows that apartments represented 22% of all million pound property sales in England and Wales in 2016 compared with 17% in 2006 and accounted for 26% of the increase of all million pound property sales between 2006 and 2016.
Unsurprisingly, the overwhelming majority of million pound plus apartments were in London with 96% of sales and the sale number in the capital has increased 193% from 973 in 2006 to 2,853 in 2016, representing 35% of all million pound property sales in Greater London in 2016.
The South East had the highest percentage increase of apartment sales in the past decade with a 389% rise from nine sales in 2006 to 44 in 2016, followed by the East of England up 283% and the South West up 150%. But the report points out that these large percentage increases, however, were from very low bases with these three regions combined accounting for only 3% of total apartment transactions above £1 million in 2016.
The only other regions to record sales of million pound apartments in 2016 were the North East and the North West, both with just one sale.
During the past 10 years, the number of million pound apartment sales increased most in the London borough of Kensington and Chelsea from 357 in 2006 to 731 in 2016 and represented 25% of all million pound apartment sales in England and Wales in 2016.
Apartment sales in Kensington and Chelsea now account for 72% of the borough’s million pound property sales compared to 40% in 2006 when terraced properties accounted for the biggest proportion of sales at 52%.
Westminster follows with an increase of 369 transactions, from 412 in 2006 to 781 in 2016, accounting for 82% of all million pound property sales in the borough last year compared to 59% in 2006. Westminster has maintained its position as the local area with the highest number of million pound apartment sales in England and Wales at 26% of the total in 2016.
Hackney is one of five boroughs in the top 20 local authority districts with the highest increase in million pound apartment sales over the past decade which had no such sales in 2006 from zero sales in 2006 to 47 in 2016, followed by Haringey with 15, Windsor and Maidenhead with 14 and St Albans and Brent both with 10.
There are two local authority districts with average apartment prices above £2 million. Westminster apartments are the most expensive at an average price of £2,215,073 followed by Kensington and Chelsea at £2,158,151.
Outside London, the most expensive apartments in the top 10 are in the Bristol at £1.8 million and South Oxfordshire also at £1.8 million.
‘The past decade has seen substantial increases in the number of million pound apartments sold, outpacing all other property types, dominated by London. A finite supply of land in prime central London combined with a growing population has meant the only way is up with more and more developers focusing on apartments,’ said Louise Santaana, Head of Lending at Lloyds Private Banking.
‘In the past decade there has been a large increase in the building of high value apartments in Knightsbridge, West End, Victoria and King’s Cross, while Marylebone and Mayfair being the top two locations for most development. With demand still high there are more in the pipeline,’ she explained.