London’s prime property market continues to defy pandemic challenges

London’s prime market has continued to go from strength to strength during the final stages of 2021, reveals a new report.

The PCL Homebuyer Demand Index by estate agent Benham and Reeves monitors demand for homes valued between £2m - £10m and £10m+ on the ratio of properties listed online that have already sold subject to contract or gone under offer.

The homebuyer demand climbed 4 per cent on a quarterly basis, and was 7.8 per cent higher annually, as foreign buyers took advantage of easing travel restrictions to reinvigorate their portfolios.

The strongest quarterly growth has been seen in London’s south west prime market, with demand climbing 23.7 per cent in Clapham between the third and final quarters of 2021, while Putney and Barnes also saw some of the largest quarterly increases.

Meanwhile, the super prime market has seen a more modest 0.2 per cent increase since Q3 although demand at the very top tier of the London market is up 2.3 per cent annually.

The best super prime performance both quarterly and annually has been recorded in Highgate where demand was non-existent in both the third quarter of 2021 and the final quarter of 2020. However, the final quarter of 2021 saw demand sit at 22.2 per cent.

Knightsbridge and Victoria also enjoyed some of the largest quarterly increases, with Hampstead Garden Suburb and Mayfair seeing the largest annual increases behind Highgate.

Marc von Grundherr, director of Benham and Reeves, commented: “Despite ongoing complications as a result of the Omicron variant, demand for London’s high end homes remained robust and demand has continued to climb both on a quarterly and annual basis.

“The pandemic’s influence remains clear with demand at its highest across areas of the South West where there is greater availability of larger homes and green space.

“However, even in the more central prime market we’re now seeing demand where there simply wasn’t any during the initial Covid-19 outbreak and this bodes very well for the year ahead.”

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