Published: 18 April 2023
Location: London, UK
Ultra-high-net-worth (UHNW) investors are turning exclusively to new-build developments in the prime property market in London, according to property consultancy Tyburn.
Citing recent deals and research over the past months, Tyburn highlighted that time-poor, cash-rich buyers, predominantly from the Middle East and North America, are increasingly seeing the long-term investment potential of London’s new builds.
Despite London achieving record sales of properties over £5m in 2022, the research indicates a shift away from properties on the secondary market. Reasons behind this change include the often-unknown expenses and time required to refurbish older properties, with strict planning permits and inflated construction costs contributing to the shift in purchasing behavior.
According to Tyburn, buyers are willing to pay up to a 30% premium to secure a home in new developments located in London’s most exclusive postcodes. Additionally, the discretion and security attached to new-build developments, which are often equipped with state-of-the-art amenities, are considered highly appealing to UHNW buyers and are difficult to recreate within older homes.
Recent data from Tyburn shows that 70% of the £793m-worth of property sales over £5m in Mayfair in 2022 were new-build sales, and this percentage increased to 80% when looking at the £634.7m-worth of sales over £10m.
Moreas Madani, founder of Tyburn, commented: “Tyburn’s recent findings into the prime central London sales market has revealed a clear buyer shift into the new-build sales arena. Although new build properties have always carried a premium, there has always been a greater desire for London’s iconic historic properties.
“However, due to increasingly stringent planning applications and sky-rocketing construction costs, time-poor UHNW buyers are opting for turn-key new-build homes with state-of-the-art amenities and security systems. With only a handful of these incredible properties on offer, there is a real demand bubbling, which is both driving prices and limiting stock.”
Source: propertyindustryeye.com
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