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05 Feb 2020

Coutts London Prime Property Index | Q4 2019

Our latest analysis of the luxury property market in London finds high-end house prices rising in response to higher demand and short supply.

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Contents

  1. Overview
  2. Local Insights
  3. Interactive Map & postcode selector tool

Our latest report on luxury property in London finds prices rising fast towards the end of last year as the UK election result and move towards Brexit certainty boosted buyer confidence.

-11.8%

Fall in high-end houses on the market compared to last year

+4.8%

Increase in London luxury property prices in Q4 2019, the vast majority of the 5.3% growth over the whole year

+10.1

Rise in prime property sales completed in the capital compared to last year

  • Overview

    Chapter 01

    Overview

    Luxury property prices across the city rose 5.3% over 2019, but 4.8% of that came in the final quarter alone. Demand is also on the up, with 10.1% more places sold in the last quarter of 2019 than the last three months of 2018. As Brexit-related worries eased, overseas buyers will have been motivated to move quickly while sterling remained under pressure.

    Meanwhile, the number of high-end houses displaying ‘For Sale’ signs is extremely low and continues to drop, falling -8.9% in the last quarter of 2019. There are now -11.8% fewer prime properties for sale on the open market compared to a year ago. New listings also fell by -16.5% in the last three months of last year, and have more than halved since the market high back in the summer of 2014.

    Despite all this, it remains a buyers’ market, with prices still lagging the 2014 peak by -11.1%, and properties in some pockets of London, such as Hammersmith & Chiswick, selling for -19% less than they were then.

    Katherine O’Shea, from the Coutts Real Estate Investment Service, says competition among buyers is likely to increase this year, putting further pressure on prices.

    “Historically, the number of properties put up for sale has usually improved in the first quarter of the year, so we would expect more homes to come on to the market over the coming months,” she says. “But the number of buyers is also likely to rise as the political uncertainty of the last few years continues to unwind. This increased demand could push prices higher.”

    She adds: “The numbers for the last quarter of 2019 could be showing us a distinct change of mood in the luxury property market. It’s been subdued and filled with uncertainty for some time, but we’re now seeing the potential for brighter times ahead.”

    Property purchases may cost more for overseas buyers

    Alex Lyneel, Home Buying Strategy Manager at Coutts, says one thing overseas buyers should be aware of is the Stamp Duty Land Tax (SDLT) reform expected as part of the UK government’s next budget on 11 March.

    He explains, “One of the expected changes to SDLT is the introduction of a new 3% surcharge for overseas buyers of residential properties.

    “No formal announcement is expected before budget day but, as we’ve seen in the past, the changes could be introduced overnight. This means they might apply to all transactions which exchange contracts after midnight on 11 March.

    “Prospective buyers could therefore look to push through their purchases now to avoid paying extra. That’s what we’ve seen happen with previous stamp duty hikes over the last few years.”

     

    Sellers less likely to budge on prices

    Fewer luxury properties are being sold at a discount too, as sellers aware of the lack of choice stick to their guns on asking price. 

    Only 41.9% of prime London property sold at a discount in the last quarter of 2019. This is the lowest figure we’ve seen since we started researching the market in 2016.

    “The numbers for the last quarter of 2019 could be showing us a distinct change of mood in the luxury property market. It’s been subdued and filled with uncertainty for some time, but we’re now seeing the potential for brighter times ahead.”
    Katherine O’Shea, Coutts Real Estate Investment Service

  • Sustainability

    Chapter 02

    local insights

    Central london bounces back

    Prices in traditional prime central locations such as Mayfair & St James’s, Knightsbridge & Belgravia, Kensington, Notting Hill & Holland Park, and Chelsea have all risen in 2019.

    Sales activity in these markets has increased significantly compared to a year ago. For example, prime property transactions in Knightsbridge & Belgravia are up 64% compared to a year ago. Knightsbridge and Belgravia also had the most super prime sales in Q4 – properties worth £10 million or more – closely followed by Mayfair & St James’s.

     

    North London sellers hold firm on prices

    The current trend towards fewer properties being sold at a discount is perhaps most keenly felt in North London.

    In Hampstead & Highgate, only 26.3% of properties are selling for less than the asking price, while in King’s Cross & Islington it’s 32.6%.

    And when buyers north of the river are getting a discount, it’s low compared to other areas, -6.1% on average in King’s Cross & Islington and -7.6% in Hampstead & Highgate, compared to -10.2% on average across prime London.

     

    New Instructions needed

    The number of new luxury properties put on the market in the last three months of 2019 fell in nearly all the areas covered by our research. The largest fall of -41.3% was seen in St John’s Wood, Regent’s Park & Primrose Hill, closely followed by Fulham & Earl’s Court with a drop of -37%.

    Comparing new instructions with the height of the market in Q2 2014, the results are even more extreme. All markets are down, and most neighbourhoods have seen new instructions fall by over 50%.

    Helping you buy your home

    Coutts can help you find your dream home anywhere in the UK.

    We can introduce you to professionals experienced in finding property to ensure you are aware of a host of suitable opportunities – both on and off the market.

    Our agents are skilled negotiators who aim to secure property on the best available terms and place you, whenever possible, in a ‘preferred purchaser’ position.

    Coutts also offers a range of flexible lending options tailored to your situation.

    To find out more, speak to your private banker or wealth manager, or call Coutts 24 on 020 7957 2424.

    Your home or property may be repossessed if you do not keep up repayments on your mortgage. 

    Over-18s only. Terms and conditions apply. You may not be eligible for all Coutts mortgage solutions. Security may be required.

  • Interactive Map & Postcode Selector Tool

    Chapter 03

    Interactive Map & Postcode Selector Tool


    Use the map and postcode selector below to see how your area performed last quarter.

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Find out more

Access more information on the methodology used in the Coutts London Prime Property Index
 

Hampstead & Highgate

New instructions in this area fell over -32% annually, and the number of prime sales shrank by -2.1% annually.

-2.1%

Annual change in quarterly sales volumes

3.4%

Annual change in price

3.7%

Annual gross rental yield

Q4 2019
Sold property price band Quarterly average sales £/SQ FT Annual change in price Time on market before sale (days) Number of properties under offer this quarter Average discount for sold stock Quarterly sales volumes Annual change in quarterly sales volumes
<£1m 909 0.3% 165 47 -6.3% 44 12.8%
£1m - £10m 1,050 3.4% 157 50 -7.6% 46 -2.1%
>£10m - - - - - - -
Source: LonRes

King's Cross & Islington

Prices in this area are close to record levels, just 1.3% below the peak. Discounts averaged at 6.1%, the lowest figure seen across all the areas covered by our index.

-5.0%

Annual change in quarterly sales volume

7.2%

Annual change in price

4.9%

Annual gross rental yield

Q4 2019
Sold property price band Quarterly average sales £/SQ FT Annual change in price Time on market before sale (days) Number of properties under offer this quarter Average discount for sold stock Quarterly sales volumes Annual change in quarterly sales volumes
<1m 765 -6.7 157 90 -5.2% 32 -11.1%
£1m - £10m 1,020 -0.2 139 40 -6.1% 19 -
>10m - - - - - - -
Source: LonRes

Marylebone, Fitzrovia & Soho

This area saw the highest drop in prices across all areas covered by the CLPPI with a -6.9% reduction in prices over the last year.

10.6%

Annual change in quarterly sales volumes

-6.9%

Annual change in price

3.5%

Annual gross rental yield

Q4 2019
Sold property price band Quarterly average sales £/SQ FT Annual change in price Time on market before sale (days) Number of properties under offer this quarter Average discount for sold stock Quarterly sales volumes Annual change in quarterly sales volumes
<1m 1,2396 13.1% 156 35 -6.8 25 -21.9%
£1m - £10m 1,620 -6.9% 156 42 -10.7% 52 -10.6%
>10m - - 226 1 - 2 -
Source: LonRes

Mayfair & St James's

Prices increased by a modest 2% over the last 12 months, but they remain 10.8% below the asking price on average.

38.5%

Annual change in quarterly sales volumes

2.0%

Annual change in price

3.1%

Annual gross rental yield

Q4 2019
Sold property price band Quarterly average sales £/SQ FT Annual change in price Time on market before sale (days) Number of properties under offer this quarter Average discount for sold stock Quarterly sales volumes Annual change in quarterly sales volumes
<1m 1,870 4.9% 137 4 -6.3% 3 -25.0%
£1m - £10m 2,176 2.0% 207 10 -16.7% 18 38.5%
>10m - -  57 5 - 3 -25.0%
Source: LonRes

Knightsbridge & Belgravia

Both sales and prices in this area show positive momentum – up 46% and 5.2% respectively compared to the year before.

64.0%

Annual change in quarterly sales volumes

5.2%

Annual change in price

2.7%

Annual gross rental yield

Q4 2019
Sold property price band Quarterly average sales £/SQ FT Annual change in price Time on market before sale (days) Number of properties under offer this quarter Average discount for sold stock Quarterly sales volumes Annual change in quarterly sales volumes
<1m 1,159 -11.6% 233 10 -13.0% 5 66.7%
£1m - £10m 2,011 5.2% 152 28 -10.0% 41 64.0%
>10m 3,826 28.0% 208 1 -25.9% 4 33.0%
Source: LonRes

Pimlico, Westminster & Victoria

Prime property is selling fastest in this area, within 127 days on average.

0%

Annual change in quarterly sales volumes

4.3%

Annual change in price

3.8%

Annual gross rental yield

Q4 2019
Sold property price band Quarterly average sales £/SQ FT Annual change in price Time on market before sale (days) Number of properties under offer this quarter Average discount for sold stock Quarterly sales volumes Annual change in quarterly sales volumes
<1m 1,041 2.0% 146 37 -7.6% 37 23.3%
£1m - £10m 1,239 4.3% 127 22 -13.3% 27 -
>10m - - - - - - -
Source: LonRes

Wimbledon, Richmond, Putney & Barnes

Prices here increased 3.7% over last year and are now just 7.8% below the peak.

 

-10.0%

Annual change in quarterly sales volumes

3.7%

Annual change in price

4.2%

Annual gross rental yield

Q4 2019
Sold property price band Quarterly average sales £/SQ FT Annual change in price Time on market before sale (days) Number of properties under offer this quarter Average discount for sold stock Quarterly sales volumes Annual change in quarterly sales volumes
<1m 717 3.1% 152 81 -7.0% 63 -26.7%
£1m - £10m 784 3.7% 140 18 -8.3% 27 -10.0%
>10m - - - - - - -
Source: LonRes

Battersea, Clapham and Wandsworth

Prime property prices in this area increased 6.3% year-on-year, the highest price hike seen across our index.

-8.5%

Annual change in quarterly sales volumes

6.3%

Annual change in price

4.6%

Annual gross rental yield

Q4 2019
Sold property price band Quarterly average sales £/SQ FT Annual change in price Time on market before sale (days) Number of properties under offer this quarter Average discount for sold stock Quarterly sales volumes Annual change in quarterly sales volumes
<1m 749 -0.4% 155 180 -6.3% 136 -12.8%
£1m - £10m 842 6.3% 168 38 -8.6% 43 -8.5%
>10m - - - - - - -
Source: LonRes

Fulham & Earl's Court

Prime property prices fell -5.9% over the last year and are now 17.6%  below the peak.

6.9%

Annual change in quarterly sales volumes

-5.9%

Annual change in price

3.9%

Annual gross rental yield

Q4 2019
Sold property price band Quarterly average sales £/SQ FT Annual change in price Time on market before sale (days) Number of properties under offer this quarter Average discount for sold stock Quarterly sales volumes Annual change in quarterly sales volumes
<1m 900 6.1% 150 71 -6.3% 80 -7.0%
£1m - £10m 1,014 -5.9% 146 43 -8.5% 62 6.9%
>10m - - - - - - -
Source: LonRes

Chelsea

Prime sales in this area increased by 51.6% annually while new instructions saw a 7.8% increase compared to the previous year.

51.6%

Annual change in quarterly sales volumes

4.2%

Annual change in price

3.0%

Annual gross rental yield

Q4 2019
Sold property price band Quarterly average sales £/SQ FT Annual change in price Time on market before sale (days) Number of properties under offer this quarter Average discount for sold stock Quarterly sales volume Annual change in quarterly sales volume
<1m 1,168 -7.6% 155 37 -9.4% 48 33.3%
£1m - £10m 1,641 4.2% 143 54 -10.6% 94 51.6%
>10m 2,729 119.2% 103 - -11.7% 2 0%
Source: LonRes

Hammersmith & Chiswick

Over 55% of prime properties here are selling at a discount, with buyers on average getting 8.8% off the asking price.

0%

Annual change in quarterly sales volumes

-4.3%

Annual change in price

4.3%

Annual gross rental yield

Q4 2019
Sold property price band Quarterly average sales £/SQ FT Annual change in price Time on market before sale (days) Number of properties under offer this quarter Average discount for sold stock Quarterly sales volumes Annual change in quarterly sales volumes
<1m 772 0.7% 163 89 -5.7% 41 -25.5%
£1m - £10m 818 -4.3% 153 49 -8.8% 29 26.0%
>10m - - - - - - -
Source: LonRes

South Kensington

Prime properties here are now taking 14.3% less time to sell compared to last year, with only a third of properties sold at a discount.

50.0%

Annual change in quarterly sales volumes

-1.2%

Annual change in price

3.1%

Annual gross rental yield

Q4 2019
Sold property price band Quarterly average sales £/SQ FT Annual change in price Time on market before sale (days) Number of properties under offer this quarter Average discount for sold stock Quarterly sales volumes Annual change in quarterly sales volumes
<1m 1,383 22.8% 142 12 -11.2% 9 50.0%
£1m - £10m, 1,675 -1.2% 161 29 -11.9% 48 50.0%
>10m 2,206 -12.7% - - -19.9
 1 -50.0%
Source: LonRes

Kensington, Notting Hill & Holland Park

Both sales and prices in this area increased moderately - up 4.8% and 2.5% respectively compared to the year before.

4.8%

Annual change in quarterly sales volumes

2.5%

Annual change in price

3.2%

Annual gross rental yield

Q4 2019
Sold property price band Quarterly average sales £/SQ FT Annual change in price Time on market before sale (days) Number of properties under offer this quarter Average discount for sold stock Quarterly sales volumes Annual change in quarterly sales volumes
<1m 1,022 -2.9% 142 68 -6.6% 59 18%
£1m - £10m 1,481 2.5% 143 72 -9.5% 87 4.8%
>10m 2,583 -8.5% - - -19.3% 2 -60%
Source: LonRes

Bayswater & Maida Vale

Sales volumnes fell -7.1% annually and are down -30.7% compared to recent peak levels.

-7.1%

Annual change in quarterly sales volumes

-1.0%

Annual change in price

4.0%

Annual gross rental yield

Q4 2019
Sold property price band Quarterly average sales £/SQ FT Annual change in price Time on market before sale (days) Number of properties under offer this quarter Average discount for sold stock Quarterly sales volumes Annual change in quarterly sales volumes
<1m 949 -8.7% 174 71 -7.0% 66 10.0%
£1m - £10m 1,245 -1.0% 159 50 -12.4% 52 -7.1%
>10m - - - - - - -
Source: LonRes

St John's Wood, Regent's Park & Primrose Hill

The number of prime sales in this area reduced by -12.5% compared to last year - the highest reduction seen across all areas covered by our index.

12.5%

Annual change in quarterly sales volumes

-4.9%

Annual change in price

4.0%

Annual gross rental yield

Q4 2019
Sold property price band Quarterly average sales £/SQ FT Annual change in price Time on market before sale (days) Number of properties under offer this quarter Average discount for sold stock Quarterly sales volumes Annual change in quarterly sales volumes
<1m 925 -0.5% 165 43 -5.7% 34 -33.3%
£1m - £10m 1,201 -4.9% 169 24 -11.7% 42 -12.5%
>10m 1,615 -39.6% 162 - -9.1% 2 -50.0%
Source: LonRes

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