London’s Housing Market Lures Hong Kongers Seeking Safe Haven

By Poppie Platt

Wealthy Hong Kong residents seeking to escape the city’s political upheaval are flocking to London, offering a potential lift to the capital’s ailing luxury housing market. Realtors are seeing a surge in interest from Hong Kong, driven by falling prices, favorable exchange rates and Prime Minister Boris Johnson’s easing of immigration rules for many residents of the former British colony. The number of Hong Kong clients registering with upmarket real estate agency Chestertons is up nearly 80% this year compared with 2019, while inquiries at Black Brick Property Solutions and Beauchamp Estates are up by about a fifth.

An influx of Hong Kong buyers would give a boost to London’s prime residential market, where prices have fallen by more than 20% since 2014, according to broker Knight Frank. Investors from the Asian financial hub accounted for nearly 10% of London luxury home purchases in 2010, but that share declined steadily in the following years before starting to pick up in 2019.

The increased interest came as mass protests rocked Hong Kong, accelerating after a political crackdown by China, which imposed a new national security law at the end of June. In response, the U.K. said it would allow almost 3 million holders of so-called British National (Overseas) passports to move to Britain. That’s helped make the U.K. the biggest draw at property exhibitions in Hong Kong, according to property app Soho.

“Unlike wealthy buyers from the Middle East or the U.S, Hong Kongers are probably looking to relocate permanently to the U.K.,” Camilla Dell, managing partner at Black Brick, said in an interview. “There will be potential for more buyers as a result of BNO holders being told they’re welcome with open arms.”

Hong Kong buyers are drawn to London by its comparatively cheap prices. The average value of prime London homes was $1,830 per square foot in June, compared with $4,440 in Hong Kong, according to Savills Plc. They also benefit from the exchange rate. Since the peak of the market in 2014, buyers with Hong Kong dollars have reaped a relative discount of 40%, twice the price decline in pound terms, Liam Bailey, Knight Frank’s global head of research, said in an emailed reply to questions.

While London’s luxury market is struggling, the country’s housing market as a whole is on the up, stoked by government support programs that are part of its efforts to restart the economy. The spike in Hong Kong buyers’ interest is also a response to changes in the U.K.’s sales tax on property purchases. A temporary tax break will expire in March, while a new higher rate on overseas buyers kicks in the following month.

“Buyers from Hong Kong are driving the luxury residential market in London at the moment,” said Kathrin Hersel, property director at Almacantar, a developer and investor whose inquiries from Hong Kong have more than doubled since mid-March from the year-earlier period. And in recent months, they’ve started to take a longer-term view of the market.

“A year ago we were probably taking more inquiries for rental investments,” Hersel said. “Now these buyers want second homes.”

Surreal Estate: London Property Panel

Since 2009, more super-prime properties have traded hands in London than in any other city – will the bubble burst? Bloomberg’s Stephanie Baker speaks with Giles Hannah, Senior Vice President at Christie’s International Real Estate, James Taylor, Project Director for Clarges Mayfair at British Land, Camilla Dell, Managing Partner and Founder at Black Brick Property Solutions and James Cooksey, Head of Central London for The Crown Estate. They speak at the Bloomberg Markets Most Influential Summit in London.

Taxed Out of Mansions, London Investors Head Down-Market

London’s swankiest neighborhoods of Knightsbridge and Belgravia are becoming no-go areas for even the wealthiest property investors.

They are being driven out by higher sales taxes introduced by Chancellor of the Exchequer George Osborne in December, which rise to as much as 12 percent of the cost of the most expensive homes.

Buying agent Camilla Dell says that her clients are spending an average of 2 million pounds ($3.1 million) less on each transaction this year and they’re more interested in cheaper areas such as Hackney and Shoreditch. That’s because an investor buying a 5 million-pound home pays almost 364,000 pounds more in tax than if they spent the same amount of money on 10 apartments costing 500,000 pounds each.

Osborne has “really depressed” the luxury market, said Dell, managing partner at broker Black Brick Property Solutions. Investors “are still spending the same amount, but they’ll split it up between several properties in the sub-1 million-pound market,” she said.

Through July 23, Dell’s Black Brick broker advised clients on 25 home purchases with an average value of 1.5 million pounds compared with 12 deals averaging of 3.54 million pounds in the same period last year. Sales of London homes for 2 million pounds or more fell by a third in the second quarter from a year earlier, according to property data provider Lonres.

With investors now buying more homes in less expensive districts, prices below Osborne’s threshold are climbing and owner-occupiers, who should have benefited from his tax cuts, are being penalized, Dell said. The tax increases kick in at 937,000 pounds.

“The very buyers Osborne was setting out to help, he’s put at a disadvantage,” she said. “At the same time, sales at the higher end have frozen. It was a very, very bad move.”

The number of investors registering an interest to buy a home in prime central London with Hamptons International dropped 10 percent in the first half compared with the same period last year, said Johnny Morris, head of research at the broker.

Investors who buy multiple apartments for about 500,000 pounds in London typically receive a rental yield of 4 percent to 5 percent, compared with about 2 percent for a luxury home in London’s best districts, Morris said.

In Kensington & Chelsea, the U.K.’s most expensive property borough, 137 homes were sold in April, the lowest monthly total since March 2009, according to the Land Registry.

Values in some of London’s best districts have been falling since the stamp-duty changes, according to broker Knight Frank LLP. Prices in the seven months through July dropped 2.3 percent in Chelsea, 2.1 percent in Knightsbridge and 0.6 percent in Notting Hill, according to data compiled by the broker.

The decline in values in prime central London “is a temporary correction, but I think PCL will eventually continue to grow,” said Giles Hannah, senior vice president at Christies International Real Estate. “That’s because there has been historical shocks before and the market has recovered.”

About 5,000 U.K. homebuyers paid the higher stamp duty levies in the first half, two-thirds of them in London, according to Nationwide Building Society. If the levies had been raised a year earlier, 6,900 purchasers would have been affected, Nationwide estimates.

The average value of a London home sold by broker Savills Plc fell by 200,000 pounds to 3 million pounds in the first half of the year, compared with the same period in 2014, while transactions fell 15 percent in the period, the broker said on Thursday.

“The buyers’ market has returned,” William Carrington, chairman of data researcher Lonres, wrote in a report on London’s best districts on Monday. “I do not see an improvement in market conditions before September.”

London Mansion Sales Stall as Sellers Ask ‘Champagne’ Prices

by Patrick Gower and Neil Callanan

Luxury Home in London

The U.K. luxury-home market’s predicted rebound from a national election slump is failing to materialize in London as buyers push back against record prices.

“For some vendors, the champagne has perhaps gone to their heads,” said Camilla Dell, managing partner at broker Black Brick Property Solutions. “They want to stick to their asking prices now and in some instances they’re actually putting their prices up.”
Realtors across the British capital saluted the Conservative Party’s May 8 victory because it spelled an end to plans for a mansion tax and rent controls proposed by the losing Labour Party. Nathalie Hirst, an independent buying agent, predicted a “wall of money” would flood the luxury-home market.

That money isn’t being spent as buyers, already discouraged by years of tax increases, balk at some valuations. Home prices in London’s priciest districts climbed 2.3 percent in May from a year earlier, according to a report last week by broker Knight Frank, the slowest growth since November 2009.

“We had a seller, he had his home on the market at 15 million pounds ($23 million) and he pushed it to 18,” following the election, said Alex Newall, managing director and founder of broker Hanover Private Office. “It’s not suddenly worth 3 million pounds more just because the election is out the way.”

Share Boost

The election result lifted shares of London-based brokers and homebuilders. Foxtons Group Plc climbed about 9 percent on May 8, the day the outcome was announced. Berkeley Group Holdings Plc rose almost 10 percent.

Pre-election jitters meant that 79 homes were sold in the 10 districts of prime central London during the three weeks following May 8, according to property data provider Lonres. That’s down from 146 during the same period last year and 120 in the three weeks before the election.

Buyers of the U.K.’s most expensive homes have faced steadily increasing costs as the government raised taxes, culminating in an increase in the stamp duty transaction charge in December.

A purchaser of a 4 million-pound home would have paid 161,880 pounds in tax in 2007, according to Savills Plc. The same home, now worth 5.5 million pounds as prices climbed, would saddle the buyer with a 572,000-pound tax bill.

That’s starting to hurt valuations, according to Knight Frank, and prices in Knightsbridge, Chelsea, Kensington and Notting Hill are now falling, according the firm.

“The stamp duty change came on top of a series of other tax revisions, all of which followed an exceptional period of growth during the financial crisis,” said Tom Bill, head of London residential research at Knight Frank. “The notion of a sudden return to double-digit annual growth or any sense of ‘business as usual’ is unfounded.”

Wealthiest Buyers Undeterred by Taxes on London Luxury Homes

By Chris Spillane

London’s most expensive homes will outperform the rest of the U.K. residential real estate market this year as wealthy buyers shrug off property-tax increases, Knight Frank LLP said.

Prices in the super-prime market of houses and apartments costing 10 million pounds ($16 million) or more will climb as much as 5 percent this year, the London-based broker estimates. Values gained 6.9 percent last year as buyers competed for fewer properties.
“Stock in this segment is very limited,” Liam Bailey, Knight Frank’s head of residential research, said by e-mail. “The population of very wealthy potential buyers has been rising strongly over the past two years and looks set to rise into 2013.”

London’s high-end properties are attracting investors seeking assets that have appreciated during Europe’s sovereign debt crisis and the Middle East’s economic and political turmoil. While price gains are slowing for homes costing an average of 3.7 million pounds, which Knight Frank defines as luxury properties, demand for super-prime London properties hasn’t abated, Bailey said.
There were 98 deals valued at 10 million pounds or more in the nine months through September, up from 94 a year earlier and 74 in 2010, according to data compiled by the firm.

Tax Havens

Many super-prime homes are owned by shell companies set up in tax havens such as the Cayman Islands to avoid transaction levies and to remain anonymous. Chancellor of the Exchequer George Osborne’s annual budget, announced in March, targeted these companies to help trim Britain’s record deficit.

In the budget, Osborne introduced a 15 percent tax, or stamp duty, on all properties bought by overseas companies. The levy on all other homes sold for more than 2 million pounds was raised to 7 percent from 5 percent.

On top of that, homes valued at 2 million pounds or more and owned by an offshore company will be taxed as much as 140,000 pounds a year, starting in April. The government will also charge a capital-gains tax on home sales by owners who are non-resident, non-naturalized persons if the value of the deal exceeds 2 million pounds.

The initial round of tax increases in March fuelled concern among potential buyers that stricter levies would follow. Luxury-home prices in areas like Knightsbridge, Mayfair and Kensington rose at their slowest rate in more than two years in December as homebuyers delayed purchases.

‘No Shocks’

The latest measures weren’t as drastic as some super-prime buyers had expected, according to Giles Hannah, co-founder of broker VanHan, which is backed by private-equity firm Palmer Capital. Hours after the government confirmed the additional levies, a Middle Eastern investor contacted VanHan looking to spend about 70 million pounds for a mansion in central London.

“This client was taking a wait-and-see approach in case there were any shocks” in terms of new taxes, Hannah said. He declined to identify the buyer.

“The 140,000 pound levy is very quickly absorbed,” Hannah said. “The numbers are so extreme that these taxes aren’t that damaging to this sector of the market. To them it’s just another bill.”

Lucian Cook, a director of residential research at broker Savills Plc (SVS), said transactions in the super-prime range have been less affected by the changes than other parts of the luxury market.

Market’s Resilience

“At this end of the prime market, housing wealth tends to be a much smaller proportion of a buyers total wealth,” Cook said by e-mail. “This suggests that it will outperform over the next five years and should be less susceptible to a slowdown in the coming year.”
Like Knight Frank, Savills expects super-prime homes to appreciate more than less expensive luxury residences, though the broker hasn’t made a specific forecast.

Oversea buyers and a scarcity of luxury properties listed for sale is also inflating values in Manhattan. The median sales price climbed 7 percent in the fourth quarter from a year earlier to $4.4 million, Douglas Elliman Real Estate said on Jan. 3. The broker defines luxury property deals as the top 10 percent by price.

The new levies are affecting how luxury homes are bought, brokers say. Offshore companies were used in 14 percent of property transactions handled by Savills before the taxes, according to the London-based broker. Since then, about 5 percent purchases have been made using a company structure.

Credit Boost

Prior to the new taxes, about 32 percent of homes worth 10 million pounds and above were purchased by an offshore company, according to data compiled by Knight Frank. After their introduction, the rate fell to 3.8 percent.

The taxes have mostly affected those luxury properties in the range of 2 million pounds to 5 million pounds. Sales in that bracket fell 44 percent in the third quarter from a year earlier. For homes valued at 5 million pounds and up, the drop was 13 percent, according to Knight Frank. For homes valued at 2 million pounds and below, sales rose by 13 percent.

While the British economy emerged from a recession in the third quarter and the Bank of England is trying to boost the availability of credit, doubt about the recovery is curtailing property demand.

Britain’s home prices may record a modest increase this year, Acadametrics Ltd. said today. Halifax forecasts home prices will probably be little changed in 2013 and Nationwide Building Society predicts that values may fall “modestly.”

U.K. home prices will fall 2 percent this year, the second straight decline, as values in every region of the country decrease for the first time since the onset of the financial crisis in 2008, Knight Frank said in November.

Kensington, Chelsea

Home owners are reluctant to sell in areas such as Kensington, Knightsbridge and Chelsea that have traditionally been home to the city’s best properties. A dwindling supply in those central London neighbourhoods and a desire among some to live near the U.K. capital’s financial districts have spurred super-prime developers to expand east toward the City of London.

Developers are turning obsolete commercial buildings into apartments in the City of London financial district as non-prime offices on the area’s fringes become difficult to lease.

One of those is the latest luxury apartment complex to be conceived by the Christian Candy’s CPC Group, which helped mastermind One Hyde Park, the U.K.’s most expensive condominium complex. CPC in November submitted a planning application to build 165 apartments near the Tower of London for a Norman Foster-designed development called Sugar Quay.

Sugar Quay

“Given the scarcity of land available for development in prime central London, you can see how and why developers are now looking for new areas develop, such as Sugar Quay,” said Camilla Dell, managing partner at Black Brick Property Solutions LLP, which helps wealthy individuals find homes in the U.K. capital.

Dell recently advised a buyer who agreed to terms on a house on a private, gated road in London’s Kensington neighborhood for 10.75 million pounds. The buyer, who she declined to identify, was seeking a house in London because his children are being educated in U.K.

London’s luxury home prices are 16 percent higher than their 2008 peak and have risen 53 percent since a post-credit crisis low in March 2009, according to Knight Frank.

Kensington Palace Gardens

The British pound has depreciated about 13 percent against a basket of currencies in the last five years, a Bank of England index shows. That makes London properties less expensive for some foreign buyers.

The Middle Eastern buyer that VanHan is acting for is seeking to buy a 30,000 square-foot (2,800 square-meter) residence in Holland Park or Kensington Palace Gardens, one of the world’s most expensive streets, Hannah said.

“For these super-prime buyers, it’s about having a solid, secure asset in a gated street with security at each end,” Hannah said.

London Luxury-Homes Price Gains Accelerate on Overseas Demand

Luxury-home prices in central London rose at the fastest pace in a year in May as the pound’s weakness encouraged overseas buyers to compete for a declining number of properties for sale, Knight Frank LLP said.

Values of houses and apartments costing an average of 3.7 million pounds ($6 million) increased 1.4 percent from the previous month, the London-based property broker said in a statement today. That’s the seventh straight increase and compares with a 1 percent gain in April.

The cost of buying homes in neighborhoods such as Knightsbridge and St. John’s Wood has climbed 33 percent since March 2009, topping the peak reached in March 2008. The number of homes for sale is 5 percent lower than a year earlier, while prospective buyers registered with Knight Frank increased 10 percent.

“For many investors and potential owner-occupiers based in fast-growing emerging countries, prices of prime central London property are actually well below the 2007 peak in their own currency terms,” said Camilla Dell, managing partner and founder of Black Brick Property Solutions LLP. Her London-based company advises luxury-home buyers in southeast England.

Since Britain’s mainstream housing market peaked in September 2007, the pound has declined 20 percent against a basket of currencies, Bank of England data show.

‘Degree of Safety’

“For international investors scouring the world for unique assets with a degree of safety that aren’t exorbitantly valued, prime central London continues to fit the bill,” Dell said. Prices are unlikely to fall soon because the shortage of properties is fueling competition between purchasers, she said.

More foreign buyers are coming to London because of political and economic instability in their home countries, Knight Frank said. London’s role as a global financial center and the reputation of its universities and private schools are also attractions.

“We have a couple of Egyptian clients who are active at the moment and, with an early Ramadan this year, we’re expecting a busy June and July,” said Johnny Turnbull, managing partner of Turnbull Property. The London-based property broker acts for buyers of top-quality homes in the city.

Finding new or recently renovated homes has become harder after banks reduced their real-estate holdings and curtailed finance for development, improving the prospects of the few projects that do proceed.

One Hyde Park

Earlier this month, property entrepreneur Christian Candy’s CPC Group said it had sold 46 apartments in the One Hyde Park development for a total of 974 million pounds. CPC has agreed additional sales worth 120 million pounds. A one-bedroom duplex show apartment in the development decorated and furnished by Candy & Candy, the interior-design company owned by Christian and his brother, Nick, fetched 9.85 million pounds.

Competition is increasing for properties in need of renovation because there’s a shortage of fully-equipped homes on the market, said Stuart Bailey, who heads Knight Frank’s Belgravia office. Two of the last three homes that needed work, with prices ranging from 6.5 million pounds to 19 million pounds, sold for more than the guide price, he said.

“We had sufficient demand that we didn’t even need to do any formal marketing,” Bailey said. Just one of the 15 homes Bailey’s team sold for more than 10 million pounds in the past year went to a buyer based in the U.K., he said.

The average price of a London home advanced 0.8 percent in March from a year earlier, while values in other parts of the country dropped, according to the most recent Land Registry data. Prices in England and Wales fell 2.3 percent, the Land Registry survey showed, as lenders granted fewer mortgages and government budget cuts reduced household incomes.

Knight Frank compiles its luxury-homes index from estimated values of properties in the Mayfair, St. John’s Wood, Regent’s Park, Kensington, Notting Hill, Chelsea, Knightsbridge, Belgravia and South Bank neighborhoods of London.

Editors: Ross Larsen, Andrew Blackman.

London’s Rich Tap New Breed of Broker in Hunt for Homes

Louise Beale interviews Camilla Dell for Bloomberg News, reporting on the use of buying agents to secure homes in the central London residential property market, where demand outstrips supply.

© Bloomberg L.P. 2010, All rights reserved, Used with permission.

London Luxury-Homes Revival May Be Hit by Bonus Curbs

By Peter Woodifield in Edinburgh

Britain’s curb on banking bonuses may stunt the recovery in London’s luxury-housing market by wiping out the windfalls that let buyers afford big mortgages, according to property brokers Knight Frank LLP and Savills Plc.

Bankers and financial-services executives are just starting to buy properties again after a year of price declines ended in March. They already account for a smaller proportion of buyers than at the peak of the market, said Liam Bailey, head of residential research at London-based Knight Frank.

“If you take bonuses out of the equation, prices can’t rise as quickly and they will take much longer to return to peak levels,” Bailey said in an interview yesterday. Knight Frank and Savills are the biggest brokers for London houses and apartments costing more than 1 million pounds ($1.6 million).

The U.K.’s five largest banks agreed two days ago to impose limits on bonuses, following guidelines set by the Group of 20 nations at their summit in Pittsburgh last week. Financial companies have cut thousands of jobs in London in the global recession, contributing to a slump in luxury-home prices in districts such as Mayfair and Chelsea.

Slower Declines

Since March, property values in the most expensive areas have fallen at a slower annual pace, Knight Frank estimates. They started to increase on a monthly basis in April and gained 1.3 percent last month. Prices are still 18 percent below their peak and 8.9 percent lower than a year ago.

U.K. house prices as a whole rose 0.9 percent in September, the fifth consecutive monthly increase, Nationwide Building Society said today. Property values returned to the level of a year earlier, the first time since March 2008 that they haven’t been lower on an annual basis.

The improvement in the luxury-homes market is being driven by a scarcity of properties, rather than more purchasers, according to Savills, which is also based in London. The number of homes for sale is about 25 percent less than the average for the past five years, the broker estimates.

Finance-industry workers accounted for 32 percent of luxury-home buyers during the past six months, up from less than 30 percent at the start of the year, Bailey said. That compared with about 40 percent at the market’s peak in 2007.

“Going forward, the bonus equation will be pretty important,” Savills Research Director Lucian Cook said in an interview. “It might take some of the heat out of the top of the market.”

Bonus Pools

Alistair Darling, the chancellor of the Exchequer, met executives from HSBC Holdings Plc, Barclays Plc, Lloyds Banking Group Plc, Royal Bank of Scotland Group Plc and Standard Chartered Plc to sign up to the G-20 principles, the Treasury said. The rules restrict the amount the lenders can devote to their bonus pools and how much they can set aside for deferred payments to executives and traders.

The level of annual bonus payments is closely correlated with movements in the prices of the best properties in central London, Cook said. Even so, the effect of the new rules may be damped by salary increases awarded to bankers to avoid a drop in compensation, he said. That could let them afford larger mortgages.

‘Less Competition’

“The curb on bonuses will result in there being less competition,” said Camilla Dell, managing partner of Black Brick Property Solutions LLC, which helps wealthy individuals find homes in the U.K. capital. “Price rises are bound to be lower if you cut off a large chunk of the buyers.”

Not all bank employees face the prospect of lower bonuses. Goldman Sachs Group Inc. set aside a record $11.4 billion to pay compensation in the first six months of this year. The securities firm has already limited guaranteed bonuses to one year and is paying a larger share in stock as amounts increase.

The pound’s weakness is making London properties more affordable for overseas buyers. Sterling has fallen 28 percent against the dollar and dropped 25 percent against the euro since the height of the boom

In dollar terms, prices for prime London properties were about 50 percent cheaper in March than two years earlier, Bailey said.

London Luxury-Home Prices Rise on Lack of Properties

By Simon Packard in London

Luxury-home prices in central London rose 4 percent in the third quarter from the previous three months as buyers competed for fewer properties, Savills Plc said.

Houses and apartments worth more than 1 million pounds ($1.6 million) in the most expensive areas fell 4.9 percent on an annual basis, the property broker said in a statement today. The largest quarterly increases were in the western districts of Chelsea, Kensington and Belgravia. The annual decline narrowed from 11.5 percent at the end of the second quarter.

“There isn’t enough property on the market in prime areas and priced attractively to satisfy demand,” said Camilla Dell, managing partner of Black Brick Property Solutions LLC, which finds and buys homes for wealthy customers. Her company, which has advised on 45 million pounds of property deals this year, is participating in closed-bid auctions for two multimillion-pound homes in London this week, she said.

The number of homes for sale is about 25 percent less than the average for the past five years, London-based Savills estimates. Demand for luxury properties increased after values fell by about 18 percent from the market’s peak in September 2007, the broker said. The pound’s weakness also made purchases cheaper for overseas buyers. Sterling slid about 20 percent against the euro and the dollar since the peak.

The scarcity of prime real estate on the market may not last, according to Yolande Barnes, joint head of residential research at Savills. The strongest market in two years will probably encourage more homeowners to sell.

Emerging from Recession

“Prices are expected at best to level out again and may fall back,” Barnes said. The rate of unemployment and how quickly the economy emerges from recession will be critical, she said.

Knight Frank LLP, another London-based broker, said in a separate report today that luxury-home prices gained 1.3 percent in September from August. They dropped 8.9 percent from a year earlier, the smallest annual decline in 12 months.

“U.K. buyers have been especially keen to take advantage of low mortgage-rate costs,” said Liam Bailey, head of residential research at Knight Frank. “The real test in the market will come when interest rates rise.”

The U.K. housing market as a whole may also be stabilizing, according to a survey published by the Royal Institution of Chartered Surveyors on Sept. 15. The number of respondents saying prices increased in August exceeded those reporting declines by 11 percentage points, the first positive reading since July 2007, the London-based organization said.

Wider Recovery?

Home prices in England and Wales rose 4.9 percent from March through July, according to figures compiled by the Land Registry, lifting the average value to 196,338 pounds.

A rebound is also beginning for what Savills describes as ultra-prime properties that cost an average of 15 million pounds. Prices for those homes gained 0.9 percent in the third quarter from the previous three months, Savills said.

Brian D’Arcy Clark, head of Savills’s Private Office unit, advised the owners of 96 Cheyne Walk in Chelsea a year ago to delay selling the 12,770-square-foot (1,186-square-meter) house overlooking the River Thames.

Next week, he will start marketing the home, a former residence of painter James Whistler. Parts of it date back to 1670. The asking price — 25 million pounds — includes six bedrooms, separate accommodations for guests or staff, and off- street parking for eight cars.

“For an estate agent to advise a client not to do a deal is unusual,” D’Arcy Clark said. The move to sell “is an indication of our confidence.”

Southwest London Leads

Outside central London, the biggest price jumps among the city’s prime residential markets occurred in southwest London in the third quarter, according to the broker.

Prices in districts such as Fulham, Clapham, Wandsworth and Richmond, which range from 500,000 pounds to 2 million pounds, climbed 8.4 percent from the previous three months and are now 2.5 percent higher than they were a year ago.

Values in these areas fell almost 26 percent from the peak of the market to the end of March, triggering purchases from owner-occupiers who don’t require large mortgages, said Lucian Cook, a research director at Savills. Prices rose 6.4 percent in the second quarter from the previous three months.

Southwest London is probably a better “leading market indicator” for top-priced homes in the city and the U.K. than central London, where overseas buyers account for almost 60 percent of purchases and more than 20 percent of sales are of second homes, Cook said.