London’s ‘super-prime’ luxury property market was world leader in 2020

UK capital is ‘world’s leading wealth destination’ after sales of homes worth more than £7.3m rose 3% last year

London had the highest number of super-luxury home purchases of any city in the world during 2020, outperforming its traditional rivals of New York and Hong Kong.

According to the upmarket estate agency group Knight Frank, 201 “super-prime” homes – collectively worth more than $3.7bn (£2.7bn) – were bought in London last year, easily knocking Hong Kong into second place with 169 sales.

Analysing transaction data from 12 super-prime residential markets around the world, Knight Frank found that overall, global sales of super-prime homes – defined as properties costing $10m (£7.3m) and above – fell just 1% in 2020.

The tiny fall in sales compared with 2019 is remarkable given the temporary property market shutdowns and various travel restrictions that were in place around the world last year, it said.

Transactions in London rose by 3% in 2020, while in Hong Kong and New York they fell by 27% and 48% respectively, allowing the capital to leapfrog both into top spot from third last year. Domestic buyers accounted for a third of all activity in London’s super-prime market, up from 12% a year earlier. European buyers were also more prevalent owing to the relative ease with which they could reach the city.

London also had the highest number of deals struck for even more expensive “ultra-prime” homes last year. Thirty-one homes worth more than $25m (£18.2m) were sold in the capital, beating Hong Kong where 23 similarly valued homes were bought, and Los Angeles with 16.

These figures contrast with “normal” house price trends in the capital. Last week Nationwide published figures for the first three months of 2021 showing that London was the UK’s weakest performer.

Liam Bailey, the global head of research at Knight Frank, said: “London’s super-prime residential market shrugged off Brexit and even looked through the pandemic – confirming the UK capital as the world’s leading wealth destination. After five years of price falls, the capital is set for a reset and the latest numbers from Knight Frank’s super-prime data confirm that London is on top of the world.

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The figures show that New York’s super-prime property market faced a series of challenges throughout 2020. The US real estate market, typically slow leading up to a presidential election, also had to contend with being hit hard by Covid shutdowns.

By contrast, waterfront property markets in the US stood out, with super-prime transactions in Miami more than doubling compared with 2019. Palm Beach and Los Angeles also recorded an increase of 78% and 26% respectively in sales above $10m.

In Sydney, 55 super-prime transactions took place in 2020, up from 46 the previous year.

Singapore’s ultra-prime market performance was notably strong, almost trebling to 14 in 2020. The city-state’s ultra-high net worth population grew by 10% in 2020. Singapore’s appeal had grown as a hub for asset and wealth management, said Knight Frank. James Dyson, Britain’s richest man according to the Sunday Times Rich List 2020, bought a £43m penthouse there in 2019.

Dubai, on the other hand, recorded a fall in the sale of luxury homes – with 22 transactions last year compared with 25 in 2019.

Contributor

Miles Brignall

The GuardianTramp

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