London's 5 million (HK$49.57 million) plus residential market segment saw 5.7 billion in turnover last year, down slightly from 2022 yet still surpassing the pre-pandemic average, according to service provider Savills.
Despite the 2023 environment of rising interest rates and super-inflation, the London luxury real estate market remains red hot.
Last year, a total of526 residential properties in London saw transaction prices exceeding 5 million, with turnover involving 10 million-plus properties hitting 3.2 billion, higher than any year between 2012 and 2019.
Over half of luxury property transactions took place in traditional prime areas, with 12 percent in Chelsea, 11 percent in Kensington, 10 percent in Belgravia, 8 percent in Mayfair, and 7 percent in Knightsbridge.
The proportion of property transactions valued above 5 million has been increasing year by year, reaching 43 percent in 2023 from 41 percent in 2022 and 28 percent in 2021.
"We expect values to remain flat this year in light of the looming general election, but forecast price growth of 3.5 percent in 2025 and 6 percent in 2026 once the global economy picks up more significantly and domestic political instability subsides,"Savills said.
The property market in the UK is buoyant, indicating a substantial surge in home-buying transactions in London, according to the UK real estate agency Foxtons.
Over the 30 days to January 4, the agent reported a 46 percent annual increase in registered potential buyers, with a 36 percent growth in property viewings.
The mortgage lender Halifax indexed a consecutive three-month climb in British house prices, with a rise of 1.1 percent in December.
The overall growth in property prices for 2023 was 1.7 percent, and a decline of 2 to 4 percent is predicted for 2024.
The Bank of England showed a two-month increase in mortgage approvals, illustrating lively homebuying activity in the UK.
UK inflation surged to a 41-year high of 11.1 percent in 2022, and the central bank raised interest rates 14 times from December 2021 to August 2023, reaching a 15-year peak of 5.25 percent.
Luxury property developer Residence One said that each property under the company has attracted inquiries from around 15 interested buyers.
It can be observed that amidst the uncertain economic outlook, the demand for luxury homes in prime central locations of London remains strong.
