Southeast Asian Investors’ Appetite for High-end Investments Unlikely to Be Affected By 2023’s Slowdown in London’s £5 Million-plus Residential Market

Based on whole market analysis provided by Savills, momentum within London’s £5 million-plus residential market slowed in 2023, however, sales remained well above the pre-pandemic average. A total of 526 sales (new build and second hand) exceeding £5 million were made in 2023. Although this is 13% lower than the record high in 2022, it is only 2.3% less than 2021, and higher than any other year since 2013.

Frances McDonald, Research Analyst, Savills, comments, “The rarefied top end of the London market outperformed the wider UK market in 2023 with transactions holding relatively steady. We expect values to remain flat this year in light of the looming (UK) general election but forecast price growth of 3.5% in 2025 and 6% in 2026 once the global economy picks up more significantly and domestic political instability subsides.”

The £5 million-plus properties transacted last year achieved £5.7 billion in value, with sales exceeding £10 million making up £3.2 billion of the total amount. This is higher than any total value achieved between 2012-2019. (Please see graph here) Half of all sales exceeding £5 million in 2023 were for apartments in traditional prime postcodes Chelsea, Kensington and Belgravia, Mayfair and Knightsbridge.

Ruben Koh, Senior Director, Head, International Residential Sales, Savills Singapore comments, “The uncertainty of the upcoming elections married with the high interest rate environment in the UK definitely had an effect on the market but is more so for the lower end of the market, as such investors tend to be more sensitive. London, being rich in heritage and lifestyle, while suffering from a scarcity of large floorplate apartments tends to be more resilient with the ultra-wealthy investors in Southeast Asia looking to acquire exclusive trophy real estate that we are offering such as The OWO Residences, The Whiteley and Park Modern. These properties, marketed by Savills Singapore’s International Residential Sales, are in super prime areas near the City."

Located in London’s highly sought-after areas such as Whitehall and Hyde Park, these residences are redevelopments or new developments, offering investors a sense of exclusivity and premium quality. The Whiteley and The OWO, for example, are properties that are located with world-class brands – the Six Senses and Raffles hotels, both firsts in London. (Please refer to Appendix A for more information)