As has been well-documented across our 2024 Buysides (not to mention global media), the year has been largely characterised by a degree of inertia as the central London property market waited, along with the rest of the world, to bear witness to the results of the UK election in July, the new Labour Government’s Autumn budget at the end of October and finally of the US election in early November. Whatever your political leanings, Trump’s resounding victory marks the last of the major global elections that have taken place this year – reportedly over 1.5 billion people went to the polls in 2024 in over 50 countries. With the political calendar now relatively clear, even with Thanksgiving and the holiday season on the horizon, there is a sense of renewed energy in the market.
The Americans are coming
Somewhat predictably, there has been much rumour since the election of a sharp rise in US buyer enquiries, alongside speculation that wealthy liberal Americans are coming to London in their droves – to shore up assets, capitalise on a burgeoning dollar and establish a bolthole to shelter from whatever Trump’s next term brings. Despite talk of this sudden mass exodus from the States, this is in truth far from a new phenomenon: we have in fact seen a steady stream of incoming US buyers who have played a key role in the central London landscape over the last few years, and the floodgates have yet to open despite the headlines. It takes time for serious families to plan such a significant move.
Special Relationship
London has always held a strong allure for a certain sector of wealthy, internationally fluid Americans; as an English-speaking cultural and business hub, the capital is seen as safe, cosmopolitan and rich in heritage. Favourable exchange rates, increasingly geographically fluid working culture and London’s relatively stable prime market have further incentivised US buyers searching for a pied-à-terre that can offer a gateway to the rest of Europe. Whilst the dollar has strengthened since the election, it is still a far cry from the levels reached in the immediate aftermath of Liz Truss’ cataclysmic mini-budget in Autumn 2022, which sparked a flurry of deals in Mayfair, some achieving in excess of £4,800 psf – a record at the time for period properties outside of the new build schemes.
The American Dream – in London
Typically, US buyers will naturally lean towards lateral apartments in central areas like Mayfair or, in recent years, Marylebone. While period buildings offer elegant proportions and a sense of history, they commonly appear rustic and old fashioned in comparison to slick New York buildings and modern buyers will often forfeit these charms for the practicality of a contemporary air-conditioned, double glazed building with full concierge and amenities.
Super-Prime me
Unsurprisingly, the super prime new build developments are hugely sought after among US buyers, particularly those offering hotel-services, which is a well-established offering all over the States and one that many buyers look to replicate in London. One Hyde Park, built during those heady days following the financial crisis and serviced by the Mandarin Oriental, was the first of its kind, but it stood alone in its field for almost two decades; in 2018, 20 Grosvenor Square offered Four Seasons service but without an on-site hotel; and it has only been the completion of schemes like the Peninsula, The Old War Office (Raffles Hotel) and The Whiteley (Six Senses opening 2025) in the last year that has cemented this offering in London.
The nuance of New Build
We are consistently active in these “Super-Prime” developments and have acted for numerous clients in purchasing special new build property, but recent planning restrictions on residential units over 2,000 sq.ft, and a distinct lack of development in the pipeline, mean the landscape is notably changing.
The new build market has always commanded a significant premium over even the best period stock in Mayfair – One Grosvenor Square units habitually traded over £6,000 psf; the Peninsula (a very popular building with Americans) famously granted no discounts and the majority have sold off plan for over £8,000 psf; and John Caudwell’s One Mayfair, due to complete in 2025 will reportedly be asking in excess of £10,000 psf (although it remains to be seen what values will be achieved).
The rise of Vintage
Historically, we have always advised clients to be aware that the new build premium does not necessarily apply down the line when it is no longer new. However, the lack of new build pipeline is propping up prices for second hand stock in the new developments – the best units are even outperforming their original sale prices. This is in stark contrast to compromised units – those with poor layouts or views – which do not hold their value in the resale market and in some cases may never sell, with some developers forced to rent remaining units or sell at a significant discount.
Meanwhile, the prices being achieved for best-in-class period apartments are creeping ever closer towards the lower end of the new-build market as motivated buyers, starved of good quality options in the new developments, are forced to widen the scope, and in some cases compete to secure a property.
It is still too early to see the full impact of the UK Budget and the US election – speculation of a flood of properties onto the market following the scrapping of the Non-Dom regime has so far proved unfounded but we have certainly seen an increase in activity. There are undoubtedly still exciting opportunities to be had, but these markets are nuanced and it has never been more important to be well-advised when navigating these transatlantic waters.
If you have any clients in need of advice on London property, whether from across the pond or closer to home, please don’t hesitate to get in touch with us.
