Mayfair A local market review Mayfair snapshot Location

Home to some of the world’s most Mayfair is one of the most exclusive parts of Art lovers are well served by The Royal famous brands including London and recognisable the world over, not Academy and food lovers are catered for by least as the top prize on a Monopoly board. the likes of Nobu and Roka. However, with Claridges, the Ritz, Cartier and It is located in the affluent borough of the introduction of Crossrail in 2018 it will be Louis Vuitton, Mayfair is Westminster and borders both Hyde Park easier than ever for tourists to visit the area. London’s most prestigious district. and Green Park. It is served by four tube stations: Bond Street, Green Park, Marble These days, much of Mayfair is occupied In addition, the area benefits from Arch and Oxford Circus, as well as a network by office space, retail, fine dining and chic a number of exclusive boutiques, of London buses. bars. The limited residential stock that is niche art galleries and well available tends to benefit from a high level known restaurants such as Home to wealthy bankers, celebrities and of architectural beauty, ranging from other high profile individuals, prior residents Georgian townhouses to neoclassical bell Hakkassan. As a result, Mayfair have included both Jimi Hendrix and George époque apartment buildings. The vast has always been a strong Frideric Handel who, separated by two majority of new development schemes favourite with global high net centuries, lived next door to each other. consist of less than ten units. worth individuals and property The area is already a popular tourist prices are five times greater than destination, drawn by the high end shopping the London average. This follows of brands such as Tiffany’s, Hermes and Burberry, the high teas of the Dorchester 123% growth over the last five and the Ritz, and iconic department stores years – a strength that looks set to such as Fortnum and Mason, Selfridges grow even further with the and Fenwicks. coming of Crossrail to Bond Street tube station in 2018.

Oxford Circus

Bond Street Selfridges Marble Arch

Roka Fenwicks

Claridges Burberry Miu Miu Cartier US Embassy Louis Vuitton Chanel Hakkassan Tiffany’s The Royal Academy of Art

Dover Street Nobu Market The Dorchester Fortnum & Mason

Green Park The Ritz Retailers Restaurants Hotels Buckingham Palace Cultural Local demographics and Tenure profile demand for housing

Residents of Westminster are among the Looking more specifically at Mayfair, there 100% most elite of London, with average salaries are currently only 4,694 people resident in over double the national average. the area – this makes up only 2% of the 90% wider borough’s population. 80% 41% The population of Westminster is currently 50% estimated at 239,294, having increased by Price growth in Mayfair reflects the limited 70% 32% from 181,286 in 2001. This is expected construction on the area. Since 2009 only to reach 258,774 in 2021, a further increase 16 schemes with 147 units have been 60% of 8%. As a result of this population growth, completed. There are currently only 11 50% the number of households in Westminster schemes under construction. 27% increased by 21% between 2001 and 2011 22% 40% to 110,000, and this is expected to increase Privately rented stock makes up the majority Proportion of households by a further 20% by 2021, bringing the total of units in Mayfair, with 50% of properties 30% number to 132,000. This represents growth falling into this category, while 28% of of approximately 2,200 households per year. properties are owner occupied and the 20% 32% remaining 22% are socially rented. 28% However, despite this marked demand, Comparatively, across Westminster as a 10% since 2009 only 3,259 new homes have whole 41% of properties are privately been built across the borough resulting rented, 32% are owner occupied and the Mayfair Westminster in a significant shortfall of housing. remainder, 27%, are socially rented. As a result, and typical of London overall, Private rented demand for homes is hugely outweighing Social rented supply and this is fuelling price inflation. Owner occupied This strong demand is reflected in the fact that, across Westminster, 63% of units currently being built have already been sold off plan. Housing market trends

In the post-recession recovery period House price growth across Westminster has Looking more specifically at Mayfair, London’s housing market has performed been extremely strong over the past few average property prices are currently strongly, outperforming the wider UK market years, rebounding almost immediately £3,062,208 – triple the average property by a significant margin. Prices across the following the Global Financial Crisis and price in Westminster and five times that city are now 45% above their previous peak. consistently outperforming wider London. In of London overall. Comparatively, Some of the strongest growth occurred in fact, since its deepest trough in 2009, prices those in affluent Belgravia are similar at prime central London, where prices are in Westminster have increased 93% while £2,978,820 while the average in prime now 65% above peak. During 2015 activity those of London have increased 74%. central London is £1,631,551. slowed and growth started to cool. However, this is something we anticipated and we In terms of growth, prices in Mayfair have welcome an orderly slowdown. Fears of a Price growth in Mayfair since 2010 increased by 123% since 2010. This is London house price bubble have subsided almost double the rated growth in prime and the market is maintaining sustainable central London. Other super prime areas and robust growth, with 12% inflation over such as Belgravia, Knightsbridge and South the last year. Moreover, activity in the new 123% Kensington have grown by over 90%. build market remains extremely strong and Property values across London as a whole demand is high, with 67% of the 51,448 new This brings average property prices in grew by 33% over the same time period. build homes under construction already Westminster to £1,015,416 and those in sold. This is the highest absorption rate of London to £506,723 equating to Westminster new build stock in recent years. wielding a premium of 100% over the capital as a whole.

Price comparison London’s new build market

70,000 80% £3,500,000

70% 60,000 £3,000,000

60%

£2,500,000 50,000 50%

£2,000,000 40,000 40%

£1,500,000 30,000 30% Average apartment price Average Private units under construction £1,000,000 20% 20,000

£500,000 10% 10,000

0 0 2007 2008 2009 2010 2011 2012 2013 2014 2015 Mayfair average Chelsea Belgravia 2001–2006 Kensington Westminster

Knightsbridge Sold Unsold Proportion Sold (RHS) Housing market prospects

London is one of a handful of global cities Price growth in Mayfair reflects the limited With the introduction of Crossrail in 2018, that attract the most affluent international construction in the area – since 2009 only we expect the prices of properties buyers, with Mayfair one of the most sought 16 schemes with 147 units have been surrounding Bond Street tube station to after locations. As a result, London’s completed. There are currently only 11 increase by 1.9% per annum above and super-prime prices are among the highest in schemes under construction. Going forward beyond general house price growth. the world, up there with Hong Kong and New the supply position will worsen. Indeed, we have already witnessed marked York. The prime market steadied somewhat increases in those properties surrounding last year reflecting the uncertainty of the Much of the development in Westminster Bond Street tube station, with such election, but we expect modest growth to in recent years has been in the form of properties increasing in value by 178% since return this year. We expect Mayfair to office to residential conversions. All of the the announcement of Crossrail in 2008. outperform because of its particular supply 14 schemes in Mayfair completed since and demand dynamics. 2011 have been office conversions. However, Westminster Council have become concerned about the impact from the loss of office space, and as a result have clamped down on conversions. This will seriously restrict future housing supply in the area and push up prices.

House Price Growth forecast

2016 2017 2018 2019

UK 3% 3% 4% 5%

London 5% 3% 5% 6%

Average house price index

250

200

150

100

Average house price index (Base = Jan 2007) Average 50

0 2007 2008 2009 2010 2011 2012 2013 2014 2015

Westminster London Base Contacts Jennet Siebrits Mark Collins Head of Residential Research Chairman of Residential +44 20 7182 2066 +44 20 7182 2264 [email protected] [email protected]

Jamie Gunning Shaun Macnamara Senior Director Residential Development Head of West End Sales Sales & Consultancy +44 20 7420 3087 +44 20 7182 2005 [email protected] [email protected]

Sources CBRE, Land Registry, Molior, Rightmove

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