A STRATEGIC CROSSROADS FOR GLOBAL BUYERS
BY JOHN ERIC & ANNA - LOUISA YON CO - MANAGING PARTNERS & GLOBAL REAL ESTATE ADVISOR
Two Countries One Vision
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As the world redefines what it means to feel at home, we unite the finest elements of two nations—offering exclusive residences and elevated experiences for the globally discerning. Backed by decades of expertise in high-net-worth real estate, we deliver a bespoke approach to transatlantic property investment, where every move is seamless and every detail, exceptional. Your next chapter starts here.
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SPRING
As Spring unfolds across London’s private gardens and historic squares, the mood in Prime Central London’s property market is anything but uniform. Behind the Georgian facades of Belgravia and the quiet courtyards of Mayfair, the city is entering one of the most nuanced periods in recent real estate history, marked not by crisis, but by correction, recalibration, and quiet opportunity.
Drawing on the most recent data from Coutts, Savills, Barclays Private Bank, and the Spring 2025 LonRes Prime Market Update, the through-line is clear: this is not a market in distress, it’s a market in transition. And those who can read between the lines stand to benefit significantly.
SPRING 2025
THE PRICE OF PRIME HAS RESET BUT THE PSYCHOLOGY HAS NOT
Let’s start with the numbers.
• Coutts reports a 2.6% decline in Q1 2025 prime prices, with values now 10.8% below their 2014 peak
• In Knightsbridge & Belgravia, nominal prices remain 20%+ down from the peak, which, adjusted for inflation, translates to a real-term discount of 40%
• Savills confirms that across Prime Central London (PCL), prices are down 21.2% nominally and 42.3% in real terms
But the most telling insight comes from LonRes, where Managing Director Anthony Payne notes:
“Everyone thinks their property is exceptional, but it’s generally not… the ‘exceptional premium’ is proving too high for buyers—and the upshot is that properties are sitting unsold.”
This dislocation between seller aspiration and buyer realism has slowed momentum at the upper end. In the £5M+ segment, sales volumes fell 13.3% YoY even as new listings increased by 31.6%, and price reductions surged 69%. Sellers are being forced to adjust—quietly but inevitably.
Yes, Costs Are High But Dollar-Based Buyers Still Come Out Ahead
Owning a £5M property in London might appear straightforward, but the true cost of acquisition can exceed £6M once you account for:
• Stamp Duty Land Tax (SDLT): £513,750 for UK nationals, rising to £613,750 for overseas buyers
• Legal fees, and any capital works or renovations.
However, American buyers are the exception. Despite the SDLT premium applied to overseas purchasers, the strength of the U.S. dollar offers a powerful hedge. When combined with discounted pricing, up to 40% below peak in real terms, U.S.-based purchasers continue to achieve remarkable overall value relative to nearly every other international cohort.
In short, while transaction costs are high across the board, dollar-based buyers are uniquely positioned to offset them through foreign exchange (FX) gains and market timing.
Americans Are Quietly Dominating the CrossBorder Buyer Pool
All four reports, Coutts, Savills, Barclays, and LonRes, agree on this point: U.S.-based buyers are driving demand at the top end of the London market.
While interest from other international markets has softened due to economic instability, policy shifts at home, or currency headwinds, the U.S. is the only region with a net positive increase in buyer activity this spring, according to the LonRes Agent Survey.
• U.S. buyer demand: +22 net balance
• Middle East: -19
• China and Asia: -25
• Rest of Europe: -17
With prices down significantly from their peak, and the dollar maintaining long-term strength against the pound, American buyers are acquiring legacy properties at discounts not seen in over a decade. As a result, they’re able to absorb higher transaction costs while still achieving a net value far superior to that of other cross-border buyers.
At a time when global volatility has sidelined many, the most strategic U.S. investors are moving—and often securing offmarket or pre-market assets through trusted networks.
The Top End Is Slowing, But Value Markets Are Holding Strong
The prime market is fragmenting—and fast.
According to LonRes:
• 56% of agents report rising demand for properties under £1M (+40 net balance)
• For homes between £5–10M, demand dropped -43 net
• For £10M+, demand collapsed to -49 net
This shift is reshaping the buyer pool. Family-sized homes in Islington, Notting Hill, Shoreditch, and Wimbledon are drawing steady interest from domestic and needsbased buyers, while trophy homes are staying on the market longer unless priced with precision.
Yet, there are early signs of resilience. The LonRes Sales Index shows PCL achieved 0.5% annual growth in Q1 2025, its first positive print since mid-2023, suggesting that wellpriced assets in established postcodes are still moving.
Interest Rates May Unleash Pent-Up Demand
One of the most critical levers in the months ahead is mortgage accessibility.
Barclays Private Bank notes that select retail mortgage rates have dipped below 4%, and a 3.75% “psychological tipping point” may trigger a surge in HNW borrowing activity.
Their research estimates £2 billion in latent demand from buyers at the £5M+ level who have so far held back due to unattractive rates.
This aligns with LonRes data, which shows:
• Sales across Prime London up 12.4% YoY
• New listings up 20.3% overall
• A 40.9% increase in under-offer homes—a sign that rate-sensitive buyers are beginning to re-engage
London’s Safe Haven Status Remains Firm— Despite Policy Shocks
Yes, the removal of the non-dom tax regime, higher SDLT rates, and VAT on private school fees have introduced new complexities. But as Barclays points out, this hasn’t changed the fundamentals.
London still offers:
• Global connectivity
• Stable legal and financial systems
• Prestigious education
• Unmatched cultural capital
Furthermore, in an era of trade volatility, currency instability, and geopolitical uncertainty, London remains one of the few globally trusted jurisdictions for long-term wealth preservation.
Final Thought: The Quiet Advantage Belongs to the Prepared
This is not a market of mass momentum. It’s a market of measured opportunity.
The data from LonRes, Coutts, Savills, and Barclays all tell the same story: Prime London is being repriced but not distressed. The window of deep value may not last long, especially if sterling strengthens or mortgage rates continue to fall.
At The Luxury Collective UK, we are Americans working with American and international buyers to:
• Access off-market inventory
• Navigate cross-border legal and tax implications
• Secure best-in-class financing
• Negotiate with discretion and leverage
Whether you’re considering a permanent move, a diversification strategy, or a generational investment for your family, this is the time to move strategically, not reactively. London is not rushing back. But those who do their homework—and act early—won’t need to.
Let’s begin the conversation.
Sources:
• Coutts London Prime Property Index –Q1 2025
• Savills Prime London Research – May 2025
• Barclays Private Bank Markets Weekly –June 2025
• LonRes Prime London Market Update –Spring Edition 2025