LONDON luxury-home prices posted the biggest gain in 19 months as many bankers were undeterred by government plans to tax their bonuses, Knight Frank LLP said.
Values of houses and apartments costing more than £1 million (S$2.3 million) rose 6.1 per cent in December from a year earlier, the most since May 2008. They climbed 2.1 per cent during the month, the London-based broker said in a statement yesterday.
Prices are still 13 per cent below their peak in March 2008.
‘The year is ending on a high note,’ Liam Bailey, head of residential research, said in the statement. ‘The short-term outlook looks positive. Long-term market performance rather depends on the outcome of the general election and next year’s emergency budget.’
Demand for luxury homes has revived in London as international buyers take advantage of the weakness of the British currency. In addition, bonuses for financial- services employees in the City of London and Canary Wharf – the two largest financial districts – may rise 50 per cent this year to £6 billion, according to Knight Frank, whose offices in Mayfair, Belgravia, Knightsbridge and Kensington exchanged contracts on 22 transactions with a combined sale price of more than £60 million in the seven days after Dec 9, when Chancellor of the Exchequer Alistair Darling imposed a 50 per cent one-time tax on bonuses exceeding £25,000. In addition, offers were accepted on a further £45 million worth of property, the broker said.
Source: Business Times, 19 Dec 2009
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