London Sales of $8 Million-Plus Homes Accelerated Last YearNeil Callanan
More than 500 homes in London sold for over 5 million pounds ($8.2 million) last year, a 24 percent increase on a year earlier, even as value gains slowed.
Investors bought 5.2 billion pounds of super-prime homes in the U.K. capital, Savills Plc said in a report today. More than 160 homes in the U.K. capital sold for more than 10 million pounds in 2013, a quarter more than in 2012. The London-based broker defines super-prime homes as those that sell for 5 million pounds or more.
Prices paid for super-prime properties in London average 2,338 pounds a square foot, the same as in 2011 and 2012, as values “are entering a period of consolidation,” the broker said. The slowest value gains for prime homes in central London were in the affluent Knightsbridge and Belgravia neighborhoods, which rose 1.8 percent and 1.7 percent respectively.
“Talk of increased taxation dampened activity in the early months of the year, backing up our expectations that there will be a lull in the market” before the general election in 2015, Lucian Cook, a director of residential research at Savills, said in the report. “Assuming no further tax increases targeting high-value properties, we anticipate five-year prime central London price growth of 23.1 percent.”
Chancellor of the Exchequer George Osborne announced a new capital-gains tax on overseas-based buyers of London homes last month. It will apply to “future gains” after the tax goes into effect in April 2015, he said, without specifying the size of the levy.
A handful of prime central London “golden postcodes” accounted for 60 percent of high-value sales, according to Savills. Knightsbridge, Belgravia, and St. James’s made up 23 percent, Kensington 14 percent, Chelsea 13 percent and South Kensington a further 10 percent.