31st July 2024
12mins
A little late wedding gift to the recently-married Duke of Westminster.
Belgravia, owned by his Grosvenor estate, has emerged as the top spot for super prime buyers in London.
Over the past two decades, Grosvenor has been carefully curating this neighbourhood with new shops and restaurants lining Elizabeth and Motcomb streets, and a hipper new development of more places to eat, drink, and shop at Eccleston Yards.
The strategy seems to be working. Belgravia, once the territory of middle aged Brits, is now attracting a younger and more global community.
Of the 120 sales worth £5m or more in London in the second quarter of the year, one in seven were in Belgravia, according to new research by estate agent Savills.
Across PCL (Prime Central London), the super prime market is showing great resilience.
The number of sales between April and June are down slightly on last year – a fact blamed on the General Election plus the imminent dismantling of the non dom system – but 38% higher than pre-pandemic (2017 to 2019).
For sales worth £10m+ sales were, again, lower than last year but 18% up on pre-pandemic levels.
This means that a total of £2.2bn has been spent on prime London property in the first half of this year.
Camilla Dell, managing partner of Black Brick, said the market has been brisk, particularly for “best in class” properties, which are always in short supply. This month, she expects plenty of interest from buyers who habitually spend summers in London either staying in hotels or renting serviced apartments and would like a permanent base. “We have just been engaged by a lovely family from Singapore, for example,” said Dell. “We have also had a family relocating to London from the Caribbean who are looking for a rental, initially, because they want to rent first before they buy. With the election now over, it is a busy time of year with many buyers gearing up to make their purchase before the end of the year.”
A difficulty facing these summer buyers is a lack of supply. “Often buyers (and tenants) come to us having surfed the property portals such as Rightmove and been disappointed at what they are seeing online. The reality is that best-in-class uncompromised property will sell or let long before it ever reaches a portal. One of the key ways we are helping our clients to navigate the market is getting them access to the best properties before anyone else”. said Dell.
Prime outer London is a more domestic market than the centre of the city and more buyers are reliant on mortgage finance.
Despite this, there are early signs of the green shoots of recovery.
London house prices increased for the first time in a year in May, according to just-released figures from the Office of National Statistics.
Average sale prices in the 12 months to May increased by an admittedly-marginal 0.2% to £523,000, up from the 3.6% fall in April and the first annual rise recorded since May 2023.
In Prime Outer London – which encompasses affluent ‘burbs like Hampstead, Dulwich, and Fulham – the market does look pretty flat. Savills reported a 0.5% fall between April and June.
What London needs, experts agree, is an interest rate cut to stimulate spending.
“I do think that the markets are anticipating a rate cut, and when that happens things could get very active,” said Dell. “A lot of people are feeling very optimistic. The election is out of the way, inflation is back down to 2%. My advice to anyone looking to buy right now would be to get on with it, if they can find the right property. I don’t see the supply issue becoming any easier and there may be more buyers out there once rates are cut.”
Deciding exactly when that will happen is an exercise in crystal ball gazing. While inflation is down, there is evidence that the underlying sources of inflation are still with us. That makes an August cut look increasingly unlikely – fingers crossed for September.
According to property portal Rightmove, a proportion of movers are holding back waiting for cheaper mortgage deals to appear, artificially slowing the market, but indicating that when rates do drop, there could be a surge of new buyers onto the market.
One of the key planks of the Labour Party’s manifesto, echoed in the recent King’s speech, is the need to reform the UK’s creakingly slow and complex planning system.
The Government wants to rip up red tape and speed up decision making in order to deliver its pledge of building 1.5m new homes by 2029. It has also announced a reintroduction of housing quotas, to force individual councils to focus on the need for more homes.
Admittedly, central London is not a strong candidate for massive new house building – there are too many historic buildings to protect, and not enough major sites to build on.
But it has certainly suffered from the slow and labyrinthine planning system.
Take Chelsea Barracks, the ultra prime redevelopment of a former army site on the borders of Chelsea and Mayfair.
A planning application was first lodged for this key site in 2008 but objectors – including the then Prince of Wales – objected to its modernity. Site owner, Qatari Diar, decided to return to the drawing board. A new, and more traditional, masterplan was approved in 2011, and full planning permission followed in 2014. Work began the next year, a full seven years after the first attempt to get building.
“We are not building enough homes,” said Dell. “The whole system just seems to be very complex. This could be a positive change, and the construction industry has reacted positively to the plans, but the proof will be in the pudding – will it actually happen?”
The streets of West London will be awash with colour when the Notting Hill Carnival comes to town over the Bank Holiday weekend. Cue three days of spectacular costumes, steel bands, live music, food and drink.
But while carnival is one of the jewels in London’s crown, the fortunes of its backdrop are mixed.
The average price of a home in Notting Hill stands at just under £1.6m, according to the latest figures from Rightmove, with average flats trading at just under £1m, terraced houses at just over £3m, and semi-detached properties at circa £6.5m.
Prices are down 9% compared to last year, and are 3% lower than its 2019 peak.
But, as we often caution, average price data only tells a part of the story.
“There is competition for the best houses on the best streets and these houses are still going for big money,” said Dell.
Notting Hill’s trophy streets include Lansdowne, Blenheim and Elgin crescents, Kensington Park Gardens, and Clarendon Road – buyers particularly like homes with access to a garden square. Those buyers tend to be mainly domestic, either British or overseas buyers who know and are settled in London.
“They like the whole vibe of Notting Hill,” said Dell. “They like the community of events in the gardens, it has got a slight edginess, and it is a bit younger and trendier than places like Knightsbridge,” said Dell.
Schools – including Prince William and Prince Harry’s alma mata Wetherby Prep School – are another big draw.
Buyers also like the fact that Notting Hill is filled with their contemporaries – mainly those who work in private equity, hedge funders, and tech entrepreneurs.
A difficulty facing Noting Hill trophy house buyers is that at the higher end of the property market vendors tend to be highly discretionary. “They can be quite unrealistic on pricing,” said Dell. “They are sellers, but only at a certain price. Often the best homes aren’t being advertised either and are sold off market.”
It is peak summer holiday season and many families have headed west for a break in Cornwall or Devon.
Anna Sharp, regional director of Black Brick and Cornwall expert, said that in normal years, this busy summer season might not be the most comfortable time to start viewing properties – the roads are busy and places to stay are hard to come by.
This year, however, is looking a little different.
“In the past I would have advised my clients to wait until the summer holidays were over to start their search,” she said. “However, the market has slowly started to heat up in the south west since the election, so I would urge them not to wait.
“If we do see an interest rate drop in August, this may bring more buyers to the market, meanwhile there is still an opportunity in the current market to competitively bid on properties which have been on the market for a while”.
The other reason for a summer visit is to get a clear idea of what summertime in the West Country looks like, tourist crowds and all. “It is good to experience Cornwall and Devon at the height of the summer to gain a realistic perspective on what the counties are like in the summer, while also understanding that this is not viewing them at their natural best,” said Sharp.
If you are considering buying a property in Cornwall, Devon, Dorset or Somerset then please don’t hesitate to contact Anna or Rupert for an initial consultation.
Our clients were in search of a bright three bedroomed apartment with garden views and good security in Kensington. They are based in the United States but frequently visit London for work and wanted a place of their own.
Their requirements were trickier than they sound. They wanted a turnkey home and lateral flats in good condition in this area are in short supply.
Despite this, we were able to find a 2,600+ sq ft property in very good condition with wonderful views which had not yet been put onto the open market. The building is well run, with well maintained communal spaces, and a full-time porter.
Our clients flew to London at short notice to view the property, loved it, and made an instant offer which was accepted before the flat hit the property portals.
Our clients had not a moment to spare in their house hunt, with a new baby due in April and a tenancy agreement which runs out at the end of this month.
They came to Black Brick for help in a market where demand for family homes far outstrips supply, particularly since they wanted to live within a short walk of their chosen nursery school.
Happily, we were able to get them first in through the door of a three bedroom, 2,000+ sq ft house in a perfect location. We then walked these first time buyers through the process – from hiring Black Brick to exchanging contracts took 12 weeks, allowing them to move into their new home with time to spare.
Black Brick has been named as one of Britain’s best buying agencies and Camilla Dell one of its top buying agents in the prestigious Chambers High Net Worth guide 2024. Both Black Brick and Camilla were ranked in the top tier “Band 1”.
Chambers undertake a search for the world’s best professional advisors each year, identifying businesses that understand the complex needs of high net worth individuals.
Chambers review said, “Black Brick have vast knowledge and experience of the idiosyncrasies involved with purchasing a property in London.”
“Camilla’s care and attention to her clients goes above and beyond,” one of our former buyers told guide researchers. “Her clients always come out on top. She is connected to the best names in the industry and has a formidable reputation.”
To view our ranking please click here.
Many London buyers dream of relocating to the West Country or investing in a coastal or country bolthole. Black Brick has just launched a dedicated West Country arm to help buyers unravel the local market, and the latest episode of our podcast series gives the inside track on buying property way out west, with expert advice from Regional Directors Anna Sharp, based in Cornwall, and Rupert Stephenson, who covers Devon, Dorset, and Somerset.
We would be delighted to hear from you to discuss your own property requirements. For a non-obligatory consultation, please contact us.
