Savills UK | London’s £5million-plus home sales slow but still 44% up on pre-pandemic level

A total of 89 £5 million-plus homes changed hands across London in Q1 2024 according to an all-market analysis from Savills, with a total value of £918 million. While that means volumes were -20% below Q1 2023, they remain 44% up on the 62 sales recorded in Q1 2019.

On a rolling annual basis, there were 504 £5 million-plus sales in the year to Q1 2024, 352 at £5m-£10 million and 152 £10 million-plus sales.

“The first three months of the year are typically quieter for the top-end of the London market, but activity is tracking at a lower level than during the post-pandemic rebound. Lower levels of stock, a weaker economic backdrop, and pre-election jitters, which typically have a greater impact on the more discretionary, very top end of the market, have all contributed to this,” comments Frances McDonald, director of research at Savills.

“The pre-emptive move by the incumbent government to call an end to the non-doms tax regime has also caused some overseas buyers to pause with decisions while they navigate the implications of the transitionary period. As a result, domestic and needs-based buyers have played a more significant role in transactions so far this year.” 

Domestic buyers bolster sales of houses

According to Savills, houses accounted for three in every five £5 million-plus transactions in Q1 2024, the highest proportion since the pandemic ‘race for space’ (Q1 2021). Houses made up 61% of £5 million-plus sales, compared to 58% in Q1 2023 and 56% in Q1 2022.

The highest proportion of sales took place in Mayfair (15%), overtaking Chelsea for the number one spot for the first time since 2020 while traditional prime postcodes (Mayfair, Belgravia, Chelsea and Kensington) still account for over half (52%) sales at this price point.

“Old-established prime central London postcodes are continuing to dominate sales at the top end as, despite recent headlines, the global wealthy continue to see London as a desirable place to live. However, we have also seen a greater number of domestic buyers active in the market this year, and this has led to an uptick in house sales – particularly in the likes of Hampstead, St Johns Wood and Kensington – typically favoured by local buyers,” comments Alex Christian, co-head of Savills Private Office.

“Despite an impending General Election, the short odds on a change in government means that we believe that political change is already largely priced into the market. Despite this, the market remains price-sensitive as the majority of buyers remain cautious and are adopting a wait-and-see approach to see how policy plays out. 

“Nevertheless, we are still seeing  a steady stream of interest – with the most notable overseas demand coming from India, The Middle East and America – and there have been some strong prices achieved, particularly for best-in-class properties – testament to the fact that quality of product and fair pricing remains critical in this market.”