Super-prime properties in Belgravia, Chelsea, Knightsbridge and Mayfair have soared 23% from their previous March 2008 peak, according to global real estate firm Knight Frank LLP, at a time when average values in London dropped 5%.
In March of this year, global real estate broker Savills sold a property on Cornwall Terrace within Regent’s Park for GDP 80 million – the most expensive sale of the year – earning the firm at least GDP 1.2 million.
Despite the global financial crisis, more of these homes have been sold in London than in any other of the world’s foremost capitals, including New York.
Research from Savills stated the UK capital accounted for roughly a third of 2012’s super-prime properties sold worldwide.
Yet according to the small group of agents who oversee the super-prime market, homes in the GBP 50 million to GBP 200 million category are proving to be elusive.
Noel De Keyzer, who leads Savills’ Sloane Street branch, sells Belgravia homes upward of GDP 100 million.
He notes that whilst demand is growing, the number of properties on his books is 50% of what it was five years ago.
It is not only greed and growth opportunities which drive the market, but fear.
Even though around a third of buyers are British, increasing numbers of safety-seeking internationals are dominating the books.
The Gulf’s oil sheiks seek an Arab Spring insurance policy and to diversify their portfolios, whilst the wealthy French aim to avoid the new tax regime launched by President Francois Hollande.
Other European millionaires, including from Cyprus and Greece, aim to convert risky assets into secure pounds, whilst ultra-high-net-worth Russians seek shelter from a shift in the political winds.
For any of these individuals, a home in London also confers status.
Not only are the postcodes enviable, there is the prestige of giving children a British education – with many wealthy individuals favouring to educate their children at Eton and Harrow; more popular than their European contemporaries.
On a more unscrupulous note, purchasing property, especially in England, is an easy way to legitimise dubious wealth on a large scale.
Capitalising on the trend, intermediaries such as lawyers, personal assistants and private bankers have begun to offer more attuned services for wealthy individuals wishing to purchase from the London property market.
Increasingly, buying agents are becoming a preferred option as well, who can claim no conflict of interest as they are paid by the seller – not the property seller.