Is the £1 million property in Mayfair set to go the way of the Dodo?
Figures show that less than five per cent of the homes sold in Mayfair are now priced below seven figures, meaning that local property prices are continuing to experience strong growth.
A report released by estate agency Wetherell, containing information collated by Dataloft, has shown that the £1 million property could soon be a thing of the past. Looking at homes sold over 2014 and 2015, the report showed that there was no property at all listed for less than £750,000, and that the vast majority sold (49 per cent) did so for a price tag between £2 million and £10 million. A further 11 per cent of the property went for over £10 million, making Mayfair one of London’s priciest and most exclusive neighbourhoods.
According to Peter Wetherell, CEO of Wetherell, the extinction of property priced at £1 million in Mayfair is inevitable. “Over the next 12-24 months apartments priced below £1 million and houses below £2 million will, like the Dodo, become extinct. This reflects the continuing upward surge in resi-values in Mayfair, a reflection of both global demand and short supply, and also the large increase in super-luxury apartment schemes being built and sold in Mayfair over the last few years. Mayfair is the new Knightsbridge you could aptly say, the fashionable place for luxury property.”
Mayfair witness to strong price growth and resilience
The report shone light on the meteoric price growth that has occurred in the area in recent and not-so-recent years, revealing that Mayfair certainly is a destination for millionaire property buyers only.
There were just a small number of properties priced between £1 million and £950,000, and the couple that were priced between £750,000 and £950,000 were dubbed “special cases”; for example, the property may have left much to be desired in the square footage stakes, or may have had a short lease. Wetherell first conducted market research on Mayfair’s residential market back in 1985, and has witnessed first-hand the explosive price growth in the area. In their first report, it was noted that a two-bedroom flat located in Balfour Place went for £225,000 – today, the same flat is valued at over £2 million. According to the report, there will be no property available in Mayfair for less than £1 million by as soon as 2018, as investors and the ultra wealthy are quick to buy into this luxurious part of London. Residential values continue to rise, and this is a trend that is not expected to wane anytime soon.
Indeed, figures for 2014 and 2015 were more or less identical, and the move away from property priced at less than £1 million has emerged as a strong trend over the past 10 years. The average selling price is now £4.8 million, or a cool £2,400 per sq. ft, a figure up from £4.5 million in 2014. Even in the wake of Brexit, an event that has caused many property forecasters to project prices slowing, Peter points to the past performance of Mayfair’s robust market as reason why Mayfair will be largely unaffected. “We may see a slight uplift, but it’s effectively ‘more of the same’,” he says. “Supply and sales volumes are less than in past years, but values are stable and rising gradually. Mayfair is like a strong ocean liner sailing in a protected fjord, out in the wider (global) oceans things might be turbulent and stormy, but protected within our anchorage the Mayfair market is reassuringly calm and stable. As our 30-year data index shows this stable long-term rise makes for an outstanding return on investment. Back in 1985 virtually no homes were valued at over £1 million, thirty years later and virtually no homes are valued below £1 million – it’s a clear indication of the outstanding value that Mayfair property offers investors.”