Savills Mayfair & St James’spdf.savills.com/documents/mayfair_st_james_home_truths.pdf1 Savills...
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1 Savills Mayfair & St James’s Home Truths Thursday 22 April 2021 Welcome and thank you for joining. You are on mute for the duration of the webinar. We will begin shortly.
Transcript of Savills Mayfair & St James’spdf.savills.com/documents/mayfair_st_james_home_truths.pdf1 Savills...
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Savills
Mayfair & St James’s
Home Truths
Thursday 22 April 2021
Welcome and thank you for joining.
You are on mute for the duration of the webinar.
We will begin shortly.
2
Introducing today’s panel
Claire Reynolds
Co-head of
Prime Central London
020 7578 5111
Jonathan Hewlett
Head of London Region,
Residential
020 7824 9018
Frances Clacy
Residential
Research
020 7409 5905
Katie Wilson
Head of Mayfair &
St James’s Lettings
020 7578 5113
Ed Lewis
Head of London
Residential Development
Sales
020 7409 9997
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Mayfair & St James’s Home Truths – 22nd April 2021Prime London Residential UpdateFrances Clacy, Residential Research
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The market in a snapshot
Dec-19 to
Mar-20
Short lived ‘Boris bounce’
Mar-20
First UK lockdown, sharp
falls in global stock markets
and commodity prices
May-20 to present
Housing market reopened but
central London lost its buzz
Source: Savills Research
Weaker global economy curtails
new wealth generation
Dec-14 to
Dec-19
Taxation, political and Brexit uncertainty
The discretionary nature of demand
means there’s less urgency
Restrictions on international travel has an
impact but gives the advantage to
those already based in the UK
Source: Savills prime London index, Q1 2021 5
Price movements across central London
-25%
-15%
-5%
5%
15%
25%
35%
Ann
ua
l pri
ce m
ovem
en
t
PCL capital values PCL rental values
Since 2014
peak
-20.5%PCL capital values
-23.2%PCL rental values
Source: Savills prime London index, Q1 2021 6
Price movements across central London
-25%
-15%
-5%
5%
15%
25%
35%
Ann
ua
l pri
ce m
ovem
en
t
PCL capital values PCL rental values
Since 2014
peak
-20.5%PCL capital values
-23.2%PCL rental values
Annual
growth
-0.9%PCL capital values
-8.0%PCL rental values
Mayfair & St James’s
rental values
-23%Since 2014 peak
-4.4%Annual growth
Mayfair & St James’s
capital values
-25%Since 2014 peak
+0.5%Annual growth
Source: Savills prime regional index, Q1 2021 7Source: Savills prime London index, Q1 2021
8Source: Savills Research using Land Registry
0
50
100
150
200
250
Num
ber
of £1
m+
tra
nsactions a
cro
ss P
CL
134 124 154
Source: Savills Research using LonRes 9
Transactions have remained relatively robust
… particularly in the market over £5m
10Source: Savills Research
0
100
200
300
400
500
600
20
11
20
12
20
13
20
14
20
15
20
16
20
17
20
18
20
19
20
20
Num
ber
of £5
m+
tra
nsactions a
cro
ss L
ond
on
£5m - £10m £10m - £15m £15m - £20m £20m+
£5m+ sales across London
3482020
£5m+ sales across London
97Q1 2021
Source: Savills Research 11
Looking forward
PCL has looked good value for some time and was poised for a recovery1
• Buy, hold & sell costs for the UK are competitive, even with SDLT surcharge 2
• Rollout of vaccines globally gives hope to the opening of travel corridors3
• And there remains pent up demand from those who have been unable to travel4
• Longer term, any tax rises and political uncertainty will dictate prices5
Source: Savills Research Note: These forecasts apply to average values in the second hand market. New build values may not move at the same rate. 12
Prime London outlook
2021 2022 2023 2024 2025 5-year
Prime central London
capital values
+3.0% +7.0% +4.0% +2.0% +4.0%
+22%
Thank you
© Savills 2020
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Local Market Update Claire Reynolds
Co-head of Prime Central London
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Our market
Sales
+33%
Buyer registrations
+16%
Multiple offers
47%
Sources: Savills data, Jan – Mar 2021 v Jan – Mar 2019.Savills Mayfair & St James’s Dealbook Data January 2019 – October 2020Lonres Jan – Mar 2021 v Jan – Mar 2019.
Buyer known to Savills
41%
International buyers
77%
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Mayfair Successes
Sold £140 million
Highest capital value achieved in Mayfair in 2020
Guide £8.5 million
Hong Kong buyer
Guide £2.85 million
Middle Eastern buyer
Chesterfield Gardens, W1JCork Street, W1JGrosvenor Square, W1K
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St. James’s Successes
Guide £1.395 million
Let through Savills, British buyer
Duke Street, SW1Y
Guide £5.275 million
Greek buyer
St. James’s Street, SW1A
Guide £2.95m
Middle Eastern buyer
Pall Mall, SW1Y
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Return of the pied-a-terre and wealthy
students
International buyer base
Emergence of branded residences
Continued self-
sufficiency from our homes
Continued significant
off-market activity
Off-plan new build sales
Market bounce in the second half of the year
Anticipated trends after lockdown
Source: Savills Research, Molior 19
Future new build supply in Mayfair
10 schemes across Mayfair expected to sell homes in the
next five years
Average number of homes per scheme is just 22
1 scheme complete, 6 under construction and 3 with
planning permission
Currently available on the market
20
Davies Street, W1K
Guide
£16.95 million
Park Place, SW1A
Guide
£25 million
Duke of York Street, SW1Y
Guide
£19.95 million
Bruton Place, W1J
Guide
£12 million
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Local Market Update
Katie Wilson
Head of Mayfair & St James’s Lettings
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Market Overview
Lack of international tenants in
lockdown 1
Original asking price
achieved
96%
Reduced rents
Increase in void periods
and rent reduction requests
Oversupply of property
Source: Savills data January 2019 - October 2020
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Emerging trends • Domestic tenants
• Demand for larger properties and outside
space
• Walking distance to the office
• Best in class properties
• Markets remain resilient, but pricing
remains key to success
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LET properties in 2020 / 2021
Burlington Gate, W1S
Green Street, W1K North Audley Street, W1K
King Street, SW1Y
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TO LET
Mayfair House,
W1K
£13,000 pw
Carlos Place,
W1K
£3,850 pw
Upper Brook Street,
W1K
£2,700 pw
Mayfair House,
W1K
£35,000 pw
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After lockdown and looking forward
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Q&A
