Super-prime property value soars 2.9% in August
Super-prime property in London, valued at £10m and above, continued its gravity-defying surge this month with values rising by nearly 3%, taking the annual rise so far to 19%.
Despite concerns of a "trickle-up" effect, which would see the super-prime prices being infected by the rest of the market, ϋber-expensive property is still bucking the trend which has drained 9.2% off the value of property this year, according to a report from London estate agent Knight Frank.
Liam Bailey, head of residential research at Knight Frank, said: “Over the past few months, we have noted that ‘super-prime’ properties worth more than £10m have proved immune from the downward trends elsewhere. There are now signs that the gap between this sector and the rest of the market is growing. Price growth accelerated from 1% in July to 2.9% in August, meaning that super-prime properties are now worth 19% more than a year ago.”
He added: “It is clear that the buyers of such homes have been relatively unaffected by the credit crunch. Indeed, spiralling commodities and oil prices are continuing to enlarge the incomes of many international ultra high net worth individuals, as well as some domestic hedge fund and private equity chiefs.”
However some experts say the top of the market has not been as insulated as some might think, and there have only been a few high-end sales over the last few months which have distorted the overall picture.
Charles McDowell, director of McDowell Property Consultants, says: "Over the last four or five months there’s been a noticeable drop off in sales of the super prime section, things have been quiet. We’re expecting business to pick up over the next few months, as sellers become more realistic about prices. So while there will probably be more sales, prices will be lower.”
He added that most of his buyers were Euroepan and UK-based, and very few were Russian or Middle Eastern, contrary to what many estate agents have said.
Both Bailey and McDowell agree that there are a number of "trophy" properties in London, particularly in areas like Mayfair and Chelsea, which remain completely unaffected by the credit crunch.
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