Home Residential PropertyLuxury Property 10% rise in London billionaire home sales driven by Gulf Sheikhs

10% rise in London billionaire home sales driven by Gulf Sheikhs

by LLP Finance Reporter
3rd Jan 24 8:26 am

London’s ultra-prime housing market for multi-millionaire and billionaire buyers rose by 10% in unit sales and 25% by value of property sold during 2023 with 54 sales for luxury properties priced over £15 million in 2023 (£1.3 billion of sales in total), compared to 49 sales in 2022 (worth £1.05 billion) – driven by American, Saudi Arabian, UAE and Chinese buyers says a new wealth survey by Beauchamp Estates.

Beauchamp Estates say that concerns over personal security and privacy and a desire for 5-star hotel style amenities has led wealthy buyers to purchase newly built apartments located in high-security super-luxury apartment buildings offering concierge security and amenities in addresses including Mayfair, Knightsbridge, Hyde Park and Whitehall.

During 2023 there was a 137% rise in the number of super-luxury new-build London apartments priced over £15 million sold, with 19 sales worth almost £385 million, up from just 8 sales worth £181 million in 2022. These apartments average 4,894 sqft in size, each costing an average of £4,306 per sqft.

The number of houses and mansions priced over £15 million sold in 2023 fell by almost 15% with 35 sold, compared to 41 sold in 2022. However, the value and size of these homes has increased, with the total value of all the houses sold being almost £925 million, compared to £876 million of sales in 2022.

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The average size of £15 million plus house sold in 2023 is 8,826 sqft in size, almost 480 sqft larger than the equivalent 2022 figure. Beauchamp Estates say that this is because buyers have been purchasing houses for personal use rather than for buy-to-flip or rental investment.

The latest year-end 2023 edition of the annual Billionaire Buyers in London survey by Beauchamp Estates has looked at sales of luxury residential properties valued over £15 million between January and December 2023, compared to 2022, 2021 and 2020, analysing deals data from LONRES, combined with the agency’s own in-house deals data and local market intelligence.

Beauchamp Estates estimate that during 2023 60% of the deals in Prime Central London for homes valued over £15 million were to buyers from just four countries – the United States, Saudi Arabia, the United Arab Emirates and China – who purchased around £780 million worth of luxury property; with Indian, Israeli and Nigerian buyers being the other key acquirers of luxury homes in London during the last 12 months.

Beauchamp Estates say around 70% of all £15 million plus deals during 2023 were cash purchases, up from 60% in 2022 and 45% in 2021. Beauchamp Estates say this is because high interest rates and a squeeze in bank lending has led to significant decline in so-called preferrential ‘billionaire mortgages’ which in previous years billionaires used to fund residential buy-to-flip opportunities.

The Beauchamp Estates survey reveals that between January and December 2023 there were 54 sales of PCL homes priced above £15 million – over £1.3 billion worth of property sold, compared to 49 sales worth £1.05 billion in 2022, £773 million in 2021 and £553 million in 2020. In four years London’s billionaire deals market has more than doubled in size.

Over the last 12 months super-prime London apartment deals achieved values of £4,306 per sqft, with the highest in 2023 hitting over £8,000 per sqft for an apartment in a newly built apartment scheme in Mayfair. The Mayfair apartment underlines the significant price premium for newly built dressed apartments with concierge and lifestyle amenities, compared to an average of £3,011 per sqft achieved for house sales. During last year, the typical billionaires’ houses being purchased had seven or eight bedrooms, a private cinema, health spa, swimming pool and outside terrace/garden.

Over the last 12 months Belgravia has been London’s top address for ultra-prime sales, accounting for 13 (24%) of the 54 £15 million plus deals, followed by Mayfair and Knightsbridge, both with 8 deals each, Kensington with 7 deals, followed by Chelsea (4), Hyde Park (4) and Whitehall (3). There have also been £15 million plus deals in Hampstead, Notting Hill, St John’s Wood, Chelsea, Regent’s Park and Richmond.  These 13 addresses are the most sought after by global wealth in London.

For the London homes sold in 2023 above £15 million the percentage difference between the average asking price and the average achieved price is -5.6%, an improvement on 2022 when the equivalent figure was -7.6%. Beauchamp Estates say this reflects the shortage of supply of high-quality homes available for sale across the capital.

In both 2023 and 2022 the busiest sales period for billionaire homes has been between March to April and during October to December, so just like domestic high-street shoppers identifying want to purchase but taking their time before they actually buy the world’s super-rich have waited for the Christmas sales before doing a flurry of big purchases in London’s trophy real estate market.

Beauchamp Estates believe it is no co-incidence that when many wealthy overseas families are in London during late November and December doing Christmas shopping in Harrods, Selfridges, Sloane Street and Bond Street they also take the opportunity to visit trophy homes in the UK capital and agree major property deals.

Beauchamp Estates observe that another key super-prime trend over the last few years has been the emergence of a giga-prime housing market in London for homes valued at over £100 million. There are now over 20 homes in London valued at over £100 million, these elite properties clustered in just seven locations – Mayfair, Belgravia, Knightsbridge, Kensington (Kensington Palace Gardens), Regent’s Park, St John’s Wood (Avenue Road) and Highgate.

During 2023 there were two major giga-prime deals, the sale of Hanover Lodge in Regent’s Park for £113 million, purchased by an Indian billionaire from a Russian vendor, and the sale of Aberconway House in Mayfair for £138 million, purchased by another Indian billionaire.

Beauchamp Estates highlight that there are several other giga-prime deals in the pipeline but that transactions for these homes take several months and are always extremely complex.

During the last quarter of 2023 Beauchamp Estates handled the sale of over £100 million worth of property in Mayfair and Knightsbridge for trophy homes including an £18 million duplex apartment in the former Harrods Depository in Knightsbridge and a £30.45 million penthouse in Greybrook House in Mayfair. All of the deals, apart from the Harrods duplex (which was to a European buyer), have been to purchasers from the United States, the United Arab Emirates and Saudi Arabia. A multi-millionaire buyer from Abu Dhabi purchased the £30.45 million penthouse in Greybrook House.

Looking at how London’s super-prime residential market will perform in 2024 Beauchamp Estates forecast that for properties priced above £15 million values will rise by 1% or 2%, with the volume of deals likely to rise by 10%, the market driven by buyers from five key countries – the United States, Saudi Arabia, the United Arab Emirates, China and India.

Gary Hersham, Founding Director of Beauchamp Estates said, “During 2023 the volume of £15 million plus deals in London’s ultra-prime housing market rose by 10% in unit sales and 25% by value of property sold, with the market dominated by buyers from just four countries – the United States, Saudi Arabia, the United Arab Emirates and China.

“Buoyant oil and gas prices and booming domestic property markets have generated huge cash reserves in Saudi Arabia, Abu Dhabi and Dubai and the Sheikhs have chosen to invest a significant chunk of these revenues in London super-prime residential property.

“The Middle East and American buyers have made their purchases in London’s so-called ‘platinum triangle’ – Mayfair, Belgravia and Knightsbridge – which is why these three addresses have been where the most £15 milion plus deals have taken place in 2023.

“During 2023, just as in 2022, there was effectively one billionaire buyer property deal per week in Central London, which indicates that the capital’s residential real estate is viewed as a proven safe haven and stable asset class.”

Jeremy Gee, Managing Director of Beauchamp Estates added, “During 2023 we witnessed the return of mainland Chinese and Hong Kong buyers to London as travel restrictions for Chinese nationals has lifted.

“Chinese buyers were a significant driver in London’s ultra-prime residential market during 2023, buying trophy homes in locations including St John’s Wood, Hampstead and Highgate. Whilst American and Middle East buyers focused on Mayfair, Belgravia and Knightsbridge, buyers from China, Hong Kong and Nigeria looked at North-West London and purchased houses with large gardens in leafy addresses such as St John’s Wood, Regent’s Park and Hampstead. London continues to ‘hold-its-own’ on the world property stage despite rising competition provided by locations such as Dubai, Miami and the South of France.”

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