PRIME GLOBAL SHOWCASE
JuLY 2019
Welcome to the July issue of the Global Showcase
In this edition we showcase 12 outstanding properties from around the world including an exceptional, private château set within over 200 hectares outside of Paris and a spectacular 15th-century palazzo on the Grand Canal in Venice. We are also delighted to share the new Savills World Cities Prime Residential Index for 2019. This article explores the latest price movements within the most established prime residential markets around the world, including the UK prime residential market. Best wishes, David Savills Private Office
Private Office dforbes@savills.com +44 (0)20 7824 9001
David Forbes
Villa Tragara
Montecito, California, USA
Contact: Billy Rose Email: brose@theagencyre.com
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Guide Price $35,000,000
Architectural estate in Montecito
Expansive gated estate of about 2.5 acres in the heart of Montecito with ocean views Exemplary design that effortlessly blends Moorish, Spanish and Italianate architecture Over 12,000 sq. ft. of grand living spaces filled with natural light Lush, manicured gardens including an olive orchard, swimming pond, heated pool and Japanese pavilion Close to acclaimed restaurants and coveted shopping areas
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Wycliffe Hall
Wycliffe, County Durham, England
Guide Price £6,950,000
Magnificent English estate
Grade II* listed Georgian masterpiece in immaculate condition with a rich history Elegant entertaining rooms including a magnificent library Beautiful gardens designed by Tom Stuart-Smith, a gold medal winner at RHS Chelsea Flower Show Located in an unspoilt and idyllic position within its own parkland on the banks of the River Tees
Contact: Agent Name Email: email@savills.com
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Near Paris, Île-de-France
Contact: Hugues de la Morandière Email: hdelamorandiere@agencevarenne.fr
Guide Price €58,000,000
Exceptional French château
One of the last great châteaux built in the spirit of pure French classicism, which has been in the same family since its construction The chateau is undoubtedly one of the most accomplished designs to be found in the pre-First World War school of classical architecture Among the many bedrooms 24 have their own bathrooms This exceptional, very private, nuisance-free complex is located at the heart of an enclosed estate extending to over 200 hectares
L'Art de Vivre
Salucci House
Zagaleta, Benahavis, Marbella
Contact: Stephen Lahiri Email: stephen@lucasfox.com
Price €11,400,000
A vision of glass, light and luxury design
Salucci House is located within the world class La Zagaleta gated community, the most exclusive address on the sparkling Costa del Sol Accommodation includes 6 bedrooms, 6 bathrooms, entertainment areas and a separate staff apartment Organic gardens with automatic irrigations, extensive water features and extensive covered and open terraces Nestled in the foothills of Zagaleta the villa offers direct views to hole 14 on the Old Golf Course La Zagaleta has a country club and 24-hour security
Au Coeur du Mont Veyrier
Lake Annecy, France
Guide Price €13,750,000
Private villa estate
Renovated to the highest of standards with unrivalled views of Lake Annecy, one of Europe’s most beautiful lakes Primary and secondary residences with separate annex totalling 1,0004 m2 of accommodation Wellness and entertainment centre complete with indoor pool, gym, Hammam and Jacuzzi Annecy 6km, Geneva Airport 42km Prime ski resorts of Chamonix, Courchevel and Megève are all within 90km
+44 (0)20 7824 9001
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3-14 PROPERTIES
17 CONTACT
15 EDITORIAL
Tudor Farms
Cambridge, Maryland, USA
Guide Price US$19,500,000
A once in a lifetime Legacy Estate
A true generational legacy opportunity of the largest assemblage of private land on the Eastern Shore Front of Maryland Estate of about 6,500 acres (2,630 hectares) with a 14,000 sq. ft. (1,300 sq. m) luxury main lodge About 3,900 acres available for potential conservation tax credit (Federal and State) Entire estate’s development cost estimated at US$85,000,000
Hanover Terrace
Regent’s Park, London, England
Contact: Stephen Lindsay Email: slindsay@savills.com
Guide Price £21,500,000 Leasehold
Grade I listed Nash residence
An imposing Grade I listed house and separate mews in one of the most sought after Nash Terraces in Regent's Park 6 bedrooms, 5 bathrooms and 8 reception rooms Meticulously refurbished throughout with luxury, interior designed accommodation Direct views across Regent’s Park and the boating lake
Villa Josephine
Chambesy, Geneva
Contact: David Colle Email: david.colle@luxury-places.ch
Guide Price 40,000,000 CHF
Historical Lake Geneva waterfront mansion
Located in an idyllic position on the shores of Lake Geneva within the commune of Pregny-Chambésy Recently renovated with over 1,000 sq. m. of living space over 4 floors Indoor pool Private beach and port with mooring facilities Breath-taking views of the lake and Alps
Camp David
Saint-Tropez, Var, France
Guide Price €20,000,000
Unique and prestigious Riviera estate
Glamourous estate situated in Les Graniers, one of the most exclusive areas of Saint-Tropez Spectacular sea views over Canebiers Bay Extensive accommodation of over 400 sq. m with development potential Landscaped grounds with swimming pool and tennis court Potential to purchase the adjacent historic property, Le Moulin, a converted mill with panoramic views and excellent accommodation
Burgate House
Loxhill, Surrey, England
Contact: Agent Name Email: leaves@savills.com
Guide Price £6,000,000
Grade II listed country house
One of the finest Queen Anne country houses within the Surrey Hills with many authentic period features Impressive elevated position with far reaching views over The South Downs Gertrude Jekyll designed gardens include a south-facing terrace, formal gardens, a paddock and woodland Approximately 40 miles from central London
Waterfront
Anières, Geneva, Switzerland
Guide Price 38,000,000 CHF
Sumptuous Swiss property
Situated on the left bank of Lake Geneva with magical views of the lake and mountains The sheltered, private estate offers 11,000 sq. m of accommodation Indoor tennis court Wine cellars Lift access Staff accommodation Direct lake access, private pontoon and port
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Ca' Dario
Dorsoduro, Venice, Italy
Contact: Agent Name Email: astorrie@savills.com
Spectacular 15th-century palazzo
Historic palazzo on the Grand Canal which has been immortalised in works by Claude Monet and John Ruskin The rarely available palazzo combines typical Venetian architecture with Renaissance-era elements and fairytale interiors 7 bedrooms, 7 bathrooms, 2 Piani Nobili, landing pontoon, walled garden Spectacular façade Panoramic roof terrace with fantastic views over the city
Research Section: World Cities Prime Residential Index Results
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We track capital and rental values, examine yields and the impact of currency. We define the prime market as properties in the top 5% of the market by price. All our cities have a big global pull on business and visitors, and most rank highly on the numerous global measures. Their key qualification is an active and growing prime residential market, which attracts international investors and occupants.
Summary
Here is the Savills World Cities Prime Residential Index 2019, which explores the latest movements within the most established prime markets around the world.
• Price growth across the world’s leading prime city housing markets slowed significantly in the second half of 2018. The Savills World Cities Prime Residential Index recorded the weakest annual increase since the global financial crisis. • The price of prime property across the different cities varies considerably, ranging from US$4,670 per sq ft in Hong Kong to US$730 per sq ft in Madrid. • Rental growth also slowed in 2018 across the prime residential city markets. But unlike capital values, there was slightly higher growth in the second half of the year compared with the first half. • Prime residential yields have been falling since 2011, but the rate of decreases has slowed. Chinese cities are the lowest yielding. Miami and Los Angeles are the highest. • As cities reach maturity on the world stage, there is likely to be less potential for high price growth and we expect prime residential markets to settle into a steadier growth trend over the foreseeable future.
Authors:
Sean Hyett
Analyst World Research +44 (0) 20 7409 8017 CONTACT NOW
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World Cities Prime Residential Index Results
Methodology: Prices for each city are based on a sample of properties. Where appropriate, we have adjusted the sample to ensure it is representative of each city’s prime market. All price movements are in local currency unless stated otherwise. Currency exchange rates are as of the 15th of the month stated.
WHERE IS THE MOST EXPENSIVE CITY IN THE WORLD?
Prime residential values in December 2018 (in US$ per sq ft)
Source: Savills Research
In terms of price, Hong Kong remains in a league of its own, having dominated the Index over the past 10 years. Average prime residential values now stand at US$4,670 per sq ft, 56% higher than second-ranked Tokyo. New York and London complete the top four rankings, while Shanghai takes fifth spot from Sydney, where values slipped. In Europe, the most expensive city is London (fourth overall) followed by Paris (ninth overall) and Moscow (13th overall). Prime properties in Berlin and Madrid are relatively good value in comparison, with prices 42% and 52% lower than Paris respectively. Elsewhere, prices in San Francisco beat Los Angeles by 16% and both are higher than Miami. In China, Shenzhen and Beijing are on a par and are 17% lower than Shanghai. For ultra-prime properties (the type of property an ultra-high-net-worth individual would own and use as a residence) the pattern is similar, but there are variations. London overtakes New York as the third most expensive city for ultra-prime residential. Moscow ranks four places higher than its prime residential score.
Top 10 cities for ultra-prime residential property (in US$ per sq ft)
WHAT’S HAPPENED TO PRICES?
In the short term
Price growth across the world’s leading city prime residential markets slowed significantly in the second half of 2018, recording the weakest annual increase since the global financial crisis. The index rose by 2.3% across 2018 as a whole, slowing to a marginal 0.3% in the second half of the year. This compares with annual growth of 3.4% in 2017. With the exception of Paris, cities that continued to see prime residential values rise throughout 2018 saw the rate of growth slow between July and December. This suggests values are hitting a high plateau. At the same time, in cities where values fell, there is evidence of markets bottoming out with the rate of decline slowing later on in 2018. Only New York saw steeper falls in the second half of the year, as a surplus of new high-end developments suppressed prices across the market. In Dubai, falls continued at a steady rate across the year.
Berlin was the biggest riser, with an annual price growth of 9.1%
- Savills World Research
In Europe, the impact of Brexit pausing the London market has boosted demand for lower-value mainland European cities. Berlin was the biggest riser in the Index, with annual price growth of 9.1%. Paris and Madrid continued to see growth, in contrast with London which slipped 2.6%. In the US, tech demand continues to drive price growth in stock-constrained San Francisco, although concern over volatility in financial markets is putting the brakes on growth in Los Angeles. Asia-Pacific cities Shanghai, Tokyo, Singapore, Hong Kong and Shenzhen were also among the strongest performers, but in all cases growth slowed dramatically during the year as cooling measures came into effect.
Prime residential capital value growth to December 2018
In the long term
Over the past 10 years, the rise of Chinese cities has been the standout trend. In Shenzhen, Beijing, Hong Kong and Shanghai, prices have seen astonishing growth of more than 130% in a decade. This reflects the impact of rising middle-class wealth and urbanisation in mainland China, and Hong Kong’s appeal as a world-class city.
Berlin has seen the next strongest long-term growth, with values increasing by 119%, significantly higher than anywhere else in Europe. Tokyo, Paris, London, New York, Singapore and Miami have all seen roughly 40% growth over the past decade, but taken very different paths. London and Singapore saw most of their growth in the first half of the decade, but additional taxes, plus political uncertainty in the case of London, have slowed the market. Conversely, growth was stronger in the past five years in Miami and, more particularly, in Tokyo. In Madrid, prime residential values have barely changed over the decade, despite a recent recovery in prices, due to high levels of distress and supply in the residential market. Prices have fallen in Moscow and Dubai as political uncertainty and lower oil prices have impacted the market.
Prime residential 10-year capital value growth to December 2018
WHAT IMPACT CAN CURRENCY PLAY?
The impact local currency can play in prime property prices
Source: Savills Research | Note: Price movement from December 2017 to December 2018
Top-tier world cities have long been the first choice for prime buyers from across the globe, and currency can have a major impact on pricing and perceived value. Throughout this report, price movements have been shown in local currencies, but this section examines how cities compare when currency fluctuations are taken into account. For example, if you’re buying a property in euros, prices in Sydney fell 4.0% in 2018 rather than a fall of 1.7% in Australian dollars, making it more appealing. However, property prices in Hong Kong have become more expensive for a euro buyer, increasing to 11.8% over 2018 compared with 7.3% in Hong Kong dollars. A Chinese buyer will find American cities have become more expensive over the year, with prices in San Francisco increasing 11.7% compared with 6.9% in local currency. On the other hand, London prices fell marginally more for a RMB buyer than a local currency buyer.
As cities reach maturity on the world stage there is likely to be less potential for rocket-fuelled price growth. We therefore generally expect a steadier growth trend to prevail across world city prime residential markets for the foreseeable future. While growth is expected to slow, we believe the search for security of tenure and title in cities where high-net-worth individuals wish to live and do business will underpin values. The world’s wealthy are expected to continue to want to hold one or more world city prime residential properties as part of their portfolio, both as a store of wealth and as a base for work and leisure.
In the short term, it’s the European cities that are likely to see the highest rates of price growth
There will be exceptions as new global cities emerge or economic conditions improve. In the short term, it’s the European cities that are likely to see the highest rates of price growth, benefiting from Brexit, lower prices, and renewed confidence in markets such as Spain. In the long term, demographics, wealth generation and political stability will each play a crucial role in determining the changes in the prime property markets across the globe.
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World Cities Prime Residential Rentals Values
Research Section: Prime UK Residential
The prime UK housing market has faced its fair share of disruption over the past five years. Most of it has been politically induced: a combination of some things taxation and all things Brexit. Throughout that period, the bulk of the market has been price sensitive. It has been dominated, but not confined to, needs-based movers, who can only put off life decisions for so long. They have been joined by those who have sensed an opportunity to adopt a long-term view of the situation and take advantage of a less competitive buying environment.
During uncertain times, the fundamentals of prime are its strength.
Frances Clacy
Head Office London Associate +44 (0) 20 7409 5905 CONTACT NOW
Faisal Choudhry
Glasgow - Director, Scottish Research +44 (0) 141 222 5880 CONTACT NOW
Lucien Cook
Director Residential Research +44 (0) 20 7016 3837 CONTACT NOW
Kirsty Bennison
Head Office London Associate Director +44 (0) 20 7016 3836 CONTACT NOW
While some discretionary buyers and sellers are sitting on the sidelines, those who are in the market remain serious about it
Opinion: Where next for prime prices?
Gaby Foord
Head Office London Associate +44 (0) 20 7299 3003 CONTACT NOW
ADJUSTING TO DISRUPTION
The latest figures from HMRC suggest that there were 3,600 sales of £1 million-plus property in the first three months of 2019. This is 14% down on the same period the previous year, but the same level as the first quarter of 2014. From this, we can infer that while some discretionary buyers and sellers are sitting on the sidelines, those who are in the market remain serious about it. Understanding where this disruption has left pricing is crucial to trading sensibly in this environment. It is not a one-size-fits-all answer. A property’s location, size, condition and likely exposure to tax all matter. Our Q&A should help both buyers and sellers get a handle on the state of play across the country. Later in the report, we provide a salutary reminder of the fundamentals that underpin value in London and the country. This reveals that a £5 million prime property in the central London market is 38% less expensive for those buying in US dollars than it was back in 2014. For those with an international horizon, prime property in New York is currently 41% more expensive than it is in London. For others with a distinctly UK focus, average house prices in areas served by a rail commute of between 30 and 60 minutes to the capital are £350,000 less than in inner London (see Too much to ask?). These are numbers that will not be lost on buyers with a keen eye on what constitutes good value. Elsewhere, we take a look at what is going on in the most resilient markets, Scotland, prime lettings, and what broadband may, or may not, mean for house prices. Had we confined our report to these topics, we would have left one significant issue unanswered. We are acutely aware that many will be looking for a perspective on what the protracted Brexit negotiations might mean for the market going forward. That seems as good a place to start as any.
Overview: Market Appraisal
Connectivity: Well off and well connected
Fundamentals: Too much to ask?
Scotland: Uncertainty. What uncertainty?
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