Billionaire buyers worried about prime London purchases under Labour - claim

Competition from Dubai and concerns about taxation under the new Labour Government have led the world’s super-rich to spend less and buy smaller homes in prime central London during the first half of 2024, research suggests.

Analysis of LonRes data by Beauchamp Estates has looked at sales of luxury residential properties valued over £15m between January and June 2024 compared with the same period in 2023.

It found that between January to June 2024 there have been £731m worth of deals agreed for the sale of ultra-prime PCL homes, almost £100 million less or a 12% drop on the £829m worth of deals agreed during the same period in 2023.

However, Beauchamp Estates highlight that the actual number of sales deals for London homes valued above £15m over the first six months of 2024 has actually risen to 46 compared with 45 over the same period in 2023.

Beauchamp Estates say that the decline in the combined value (in £ sterling) of the deals is because multi-millionaires and billionaires have been spending less overall in London and buying smaller homes during the first half of this year.

In the first half of 2024 super-wealthy buyers spent an average of £16.56m buying a London home, down from the first half of 2023 when the average spend was £18.5m and the equivalent period in 2022 when the average spend was £21m. 

While in the first half of 2023 billionaires focused on acquiring large homes that averaged 11,200 sqft in size, in the first half of 2024 the size of house being purchased has almost halved to just 6,500 sqft. In 2022 the average size of £15 million plus house being purchased was 7,000 sqft,

Beauchamp Estates said the £15m-plus residential market in London is currently being driven by buyers from just five countries the United States, India, Saudi Arabia, the United Arab Emirates and Britain. Other significant buyers are from Qatar, Canada, Nigeria, Pakistan and China.

The agent warned that the UK capital faces rising competition from locations including Dubai, the French Riviera and Miami.

Beauchamp Estates highlight that residential property prices in Dubai have risen by 20% since 2020 and in 2023 the number of deals rose by almost 30% and there were twice as many deals for homes valued over £15 million compared to London.

Similarly data from the French offices of Beauchamp Estates shows that for homes valued above €15m (£12.85,) along the French Riviera, prices have risen on average by 20% between 2019 and 2023, exceeding the performance of equivalent homes in London where values rose by 13%. In Miami prime residential values have risen by more than 7% over the last 12 months driven by real estate investment from Latin America.

Gary Hersham, founding director of Beauchamp Estates, said: “The steady flow of £15m- plus deals during the first half of 2024 shows that London remains an essential location for multi-millionaires and billionaires to buy and have a home as part of their global property portfolio. 

“During the first six months of 2024 there has effectively been two billionaire buyer property deals per week in Central London, which is extremely positive. However, the overall spend and the size of homes being purchased in 2024 is down on 2023 and this shows that whilst there remains a sustained appetite amongst the world’s super rich for buying homes in the UK capital the new Labour government needs to be mindful that too much taxation and regulation could make buyers choose to invest elsewhere. The new government needs to focus on keeping London as a highly attractive place to live, invest and do business.”