x Abu Dhabi, UAESunday 23 July 2017

Young, Arab professional and set to buy a home in London

London's luxury property market has long attracted the wealthy but now it's no longer so much the heads of Arabian Gulf families paying the huge prices but younger professionals, many of them from the UAE.

Andrew Phillips, the head of central London sales at Hamptons, says appetite from Dubai for London property is stronger now. Stephen Lock for The National
Andrew Phillips, the head of central London sales at Hamptons, says appetite from Dubai for London property is stronger now. Stephen Lock for The National

There is a new type of buyer in the top end of London's property market. He is a young professional, likely to be married; he might work in the big financial institutions of the city's financial district; and he is increasingly likely to be an Arab from one of the GCC countries.

So says Andrew Phillips,the head of central London sales for the posh people's estate agents, Hamptons.

The young Arab buyer is also more likely to look beyond the "golden belt" of Belgravia, Knightsbridge and Mayfair, even wandering as far as Notting Hill to the west or Islington to the east of London.

And the buyer is likely to pay cash for his town house or luxury apartment in one of the British capital's "super prime" areas, with a price tag of up to £20 million (Dh109.4m).

"From the UAE recently we've seen a pick-up in interest from younger buyers. Before it was the heads of families that led the way, but now there is a trend to younger professionals with families," says Mr Phillips.

The recovery in UAE property prices has got investors looking again at London as an investment, and as a place to live, at least for part of the year.

"The Middle East began as a buyers' market in the 1970s, and people from there are now established, historic buyers," he says. Even regional events like the financial crisis of 2009 and the Arab Spring of 2011 do not seem to have seriously affected demand for top-end London property, he adds.

"When there's a local crisis in other parts of the world we get a surge effect. For example, the Hong Kong market is showing signs of being recessional now, so we're getting a lot more interest from Singapore and Malaysia. But the Middle East has been consistent and maintained throughout the recent problems. The appetite from Dubai is stronger now that the local market there is improving. Buyers and investors in the UAE are aware of the strength of the London market."

Although buyers from the Emirates may be willing to look farther afield, the big money is still to be made in the "golden belt" that stretches from Mayfair, though Belgravia and Knightsbridge, and into Kensington and Chelsea.

Within that "super prime" area, there are little islands of "super-super prime", where house prices become eye-watering. The development at One Hyde Park, home to Arabian Gulf sheikhs, Russian oligarchs and global pop stars, fetches prices of £6,000 to £7,000 per square foot, which could translate into a total price of more than £100m.

It seems bizarre to talk of "affordable" housing in the "super prime" bracket, but even a multimillionaire might baulk at such prices. If so, there are comparative bargains to be had farther down Brompton Road, Knightsbridge. "There is more affordable 'super prime' available in Kensington and Chelsea, with averages around £3,000 per square foot, and at £2 to £2.5k in the area north of Hyde Park area and Notting Hill Gate. These are more family oriented areas.

"Super-prime was £15m, now it's heading towards £20m. A four-bed family home in Kensington or Chelsea could be in the region £10m to £15m, but that would rise to between £30m to £100m in Knightsbridge, Mayfair, or Belgravia," Mr Phillips adds.

"There has also been a surge of interest outside London. Once buyers are established in central London, they begin to enjoy the Home Counties lifestyle, horses, polo, country life. We're just marketing a development called Long Walk in Windsor, near the castle, where you can wave out of your window at the queen, should she be passing.

"There is an equal appetite from all countries of the GCC. There is no country that really sticks out above others. You might expect the Saudi market, as the biggest and wealthiest in the region, to be bigger than the others, but that isn't really the case.

"The UAE and Qatar are just as big, and I haven't really noticed a fall-off in buying from Bahrain since their problems," he says.

Despite the recent surge in ownership from Gulf countries, Europeans are still the biggest buyers of luxury London property, Mr Phillips says, with French and Italians especially enthusiastic, particularly those working for big financial institutions. And, contrary to the allegations from critics of the trend of foreign buying in London, there are plenty of British buyers still, he adds.

"Rising property prices, which we've consistently seen in central London, is good for the main housing market, and good for all sorts of associated industries, like building, development and design."

Is there a possibility that the soaring market - there were more buyers in May last year than in the peak months of 2007 - could turn into a bubble?

"No", Mr Phillips says firmly. "The appetite for residential property in central London is tremendous. I have a saying: the global economy is based on the US dollar, but the next best currency is property in Knightsbridge."

 

fkane@thenational.ae