How has London Real Estate performed?
Luxury real estate in London has been notable for its resilience and enduring appeal to high-net-worth individuals, investors, and international buyers. Here are some key observations:
- Prime Central London (PCL) Prices: Prime central London areas like Mayfair, Knightsbridge, and Chelsea traditionally command some of the highest property prices in the city. Prices for luxury properties in these areas have shown resilience over the years, despite occasional fluctuations driven by external factors such as economic uncertainty and changes in tax regulations.
- Demand from International Buyers: London’s luxury real estate market has long been attractive to international buyers, particularly from regions such as Asia, the Middle East, and Russia. Factors such as the city’s status as a global financial centre, cultural amenities, and stability have continued to draw wealthy investors seeking prime properties.
- New Developments and Regeneration Projects: Luxury property developers in London often focus on creating high-end residential developments that offer luxurious amenities, premium finishes, and sought-after locations. Regeneration projects in areas like Battersea Power Station and Nine Elms have also contributed to the supply of luxury housing options.
- Tech and Finance Hubs: The rise of tech and finance hubs in areas like Shoreditch and Canary Wharf has contributed to the demand for luxury properties among professionals in these industries. The appeal of living close to work, combined with the amenities and prestige associated with luxury developments, has driven interest in these areas.
Some new (2024) Statistics for You
London’s prime property market has had a relatively positive start to the year with plenty of green shoots starting to emerge, particularly at the top end, according to a report from LonRes, released in February 2024 in the U.K. and reported by Liz Lucking in MANSION GLOBAL.
Sales of £5 million-plus homes across prime London were 64% above their 2017 to 2019 average
- In January, across the capital’s most upscale neighbourhoods, including Chelsea, Kensington, Mayfair and Knightsbridge, the number of homes entering contract—the timeliest indicator of demand—grew by 5.4% compared to a year ago and was 15.6% ahead of the longer-term average, according to Nick Gregori, head of research at the data firm.
- In another promising sign, the number of deals falling through or being withdrawn were lower in January than at the same time last year.
- It’s the very top end of the market that’s the most active, according to the report.
- “Sales of £5 million-plus (US$6.3 million and up) homes across prime London were 17% lower in January than a year earlier, but 64% above their 2017 to 2019 average for the same month,” Gregori said.
- “Supply in this market continues to grow, with new [lisings] in January 42% higher on an annual basis.”
According to Freya Mannion in her article in B MAGAZINE also in February 2024, “Over a ten-year period, house prices in London have increased by £150,000 on average, highlighting a vast 44% growth.”
The article carries on to explore the “Drive behind the Surge” and “Opportunities for Investment”, which include:
- Heightened demand stimulates construction activity, creating jobs and driving economic growth. Meanwhile, the influx of investment contributes to the development of luxury residential projects, creating more options for buyers and adding to the city’s vibrant urban landscape.
- Luxury properties in London are known to experience robust capital appreciation over time. As demand for prime real estate continues to grow, investors will stand to benefit from the potential appreciation of their property assets.
- This makes luxury property investments in the city an attractive option for investors seeking to preserve and grow capital in a relatively secure environment.
- Luxury properties in London can also offer investors and homeowners a steady stream of rental income. With high demand for upscale rental accommodation from affluent tenants, investors can charge premium prices and generate strong returns.
About CONRAD FAMILY OFFICE (CFO)
Shepperson Consulting closely collaborates with Conrad Family Office in the provision of services to Ultra High Net Worth (UHNW) Individuals and High Net Worth (HNW) Individuals. There are two elements to Conrad Family Office.
The Real Estate Lending Business – www.conradcapital.co.uk
The Real Estate Business, which is like a mini bank, arranging short term business loans, secured on prime UK Real Estate is predominantly funded by their private clients. It has always been good to these private clients.
CFO have their own Solicitors for this business in Mayfair, The City of London and Lincolns Inn, London. All of these interlink with overseas law firms as needed on any global business transactions.
The Private Client Office – www.conradfamilyoffice.com
The Link to the CFO Private Client Office corporate brochure is: https://www.conradfamilyoffice.com/Introduction
The Private Client Office was born out of the above business. This contains CFO’s top five private clients on an inner circle basis and an outer circle of everything else, which is extremely diverse.
This diversity brings a mix to the day-to-day workload of Real Estate Lending and private client transaction business.
CFO have also received enquiries from professionals and clients looking to work with us on international banking and client introductions and referrals, legal, arbitration and trust work.
Samples of Conrad Family Office Transactions (only 2024)
The below are transactions CFO have been involved in the first few months of 2024:
- A super car sale for a Monaco client @ €3.5M
- A super car sale for a German client @ €2.7M
- A €35M refinance of a Monaco property valued at €75M
- A $75M refinance of a NYC hotel
- A £15M loan to a London based Plc
- A £4.0M loan secured as a second charge on a London property
- A £7.0M loan secured as a first charge on a London property
- Setting up a UK structure to assist a UAE client acquire a number of residential investment properties totalling £22M
- Assisting a client with the sale of a Mayfair Penthouse, value £40M
- Assisting a client with the purchase of a London property, value £22M
- Onboarding a Far East client who has chosen to invest £25M into CFO’s Real Estate Lending business in London, returning them an investment coupon of 12% per annum
- CFO have arranged numerous small Real Estate loans also between £500K to £2.5M in London and prime UK locations.
