Prime central London residential house prices will grow by 6% this year in stark contrast to the rest of the UK, new research from CBRE has revealed. Average house prices in prime central London have increased by 35% over the last three years and are now 16% above their 2007 peak.
London can only be matched by Monaco and Hong Kong in terms of new build property prices with prime homes typically achieving between £1,500 and £2,500 (US $2,000 US $3,800) per ft² and exclusive super prime properties selling for in excess of £3,000 ($5,000) per ft².
Mark Collins, Head of Residential, CBRE, said: "Super-prime residential markets have emerged as one of the only secure investment options for the world's super wealthy. The very top-end of the market remains exclusive, involving only a handful of cities, and within this elite group London is still one of the most compelling choices.
"As well as its position as an important financial and cultural destination, London's time-zone, infrastructure, education system and the language make it the top choice location for a trophy asset."
London is now absorbing a greater share of the global prime residential market causing it to grow. Landmark luxury developments have helped create new prime areas in London outside of the traditional 'golden postcodes' of Knightsbridge, Mayfair and Belgravia.
Over the last decade, there has been a noticeable shift eastwards towards the City as values have increased to reflect the importance of the area as the world's premier financial and business district.
Collins added: "London's limited source of developable land means that supply will almost never satisfy demand. Whilst the location of a prime or super-prime home is still paramount, exceptional schemes have created new market contending locations.
"Design and architecture are also important, but most extremely wealthy homebuyers will now not even consider a scheme without state-of-the-art security and a comprehensive concierge service, ideally from a well-known luxury brand, because they need to know that they are getting the very best money can buy."