Written by Steve McGregor, group MD at DMA Group
According to Knight Frank, more money was spent on super prime properties in 2020 than in 2019, despite the hattrick of lockdowns. What’s more, the £10 million-plus price bracket has been the strongest part of the new-build market since the property market re-opened in May.
The pandemic has been a complex and challenging time. Countries, organisations, and individuals have fought through a series of lockdowns. However, in a year of physical isolation, certain groups have been economically isolated from the fall-out. The Institute for Policy Studies has been following the fate of the world’s billionaires to find that their combined wealth increased by more than 1.3 trillion USD since the pandemic lockdowns began.
The super prime market in London is one of the areas that is thriving as a result. In 2020, 201 super-prime and 31 ultra-prime homes were sold in the UK capital – more than both its traditional rivals, Hong Kong and New York. One-third of those sales were from domestic buyers, significantly up from 12 percent in 2019. In such volatile times, many of the sales add to the owner’s international home portfolios in the most exclusive urban locations. The market also remains attractive to international buyers despite Brexit. These are promising numbers for the UK as it faces down Covid-19 and Brexit simultaneously.
The global pandemic has transformed the way people use space, from remote working to online shopping. It has also evoked a health consciousness in many. It has changed what many look for in their environment, and the super prime market is not immune.
Well designed tech
The resilient demand for luxury city centre residences, some serviced by deluxe five-star hotel brands, enables owners to secure stunning home-from-home spaces that provide personal comfort alongside whatever they want, whenever they want it. Owners expect the latest and best technology at their finger tips, from smart home automation and security systems to integrated feature-rich home entertainment and powerful business connectivity. However, this move to smart automation heightens cyber-security risk, so it’s critical that developers and managers install well-managed technology. But above all, it must be tailored to the resident experience, ensuring a seamless home-to-home experience from the moment they arrive.
Health and wellbeing
The move towards touchless tech, is fuelled by a pandemic that has altered our awareness of health. Personal health and self-care became far more challenging during the multiple UK lockdowns, while the importance of mental health and personal connection became even more important. Health and wellbeing will be deemed more important than ever after the pandemic. We will see this reflected in private spaces. Large, open spaces with biophilic design, natural light and generous ventilation will be increasingly in demand. Personal pools and gyms will be more important as the potential to get out with friends or work with personal trainers is limited.
These spaces have also become more than a home. Many people are regularly working from home, and that is likely to continue in the coming years. Designing wellness and comfort into residencies is even more important as people spend more time at home. Many clients are also searching for properties with extra space for home offices. Similar patterns are evident in the US; despite a drop in transaction numbers, the average price for super prime residencies increased by 5 percent year-on-year, suggesting that buyers are looking towards the higher end of the market for larger spaces.
Tailoring to the individual
When it comes to super prime residencies, buyers won’t settle for second-best. Those looking to invest in UK property now will look for a developments that meets all their needs. Attracting buyers means catering to their every need. Location, access, and design are all important, but so is the capacity for residents to redesign their spaces. Larger residencies meant as primary homes should offer plenty of space for personalisation. In contrast, central locations should offer stunning design from the off.
The super prime market is in a strong position despite the turbulence of the past several years. It has great potential for growth, but developers, managers and agents must ensure that their sites are catering for the needs of those searching. London has had a strong year, but there is no guarantee that it will continue. However, although London remains an iconic city, the English countryside offers an idyll for those looking to escape the city for a weekend. The coming years will determine how Brexit and the possibility of future pandemics will affect the country and the super prime market.
Imagery provided by DMA Group.