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Death of the Six-Figure House

It’s always been exclusive, but in the West End hotspot, properties worth less than £1m will soon be a thing of the past

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Only a handful of homes in Mayfair went for under £1m last year.

Pawel Libera / Getty Images
Only a handful of homes in Mayfair went for under £1m last year.
Pawel Libera / Getty Images

Could the six-figure home be going the way of the dodo and the passenger pigeon? According to one London estate agency, it will soon be impossible to buy a property in the most sought-after parts of the capital for less than £1m. You probably won’t see many “Save the £950,000 flat” bumper stickers or epetitions, but a report by the West End agency Wetherell puts the six-figure Mayfair apartment in the same category as the black rhino and the hawksbill turtle — on the verge of extinction. Just a handful of homes were sold in Mayfair last year for under £1m, and most of those went for upwards of £950,000: The only ones that sold for less were tiny studios on short-term leases.

It was a similar story in 2014, and Peter Wetherell, the company’s chief executive, is convinced that the sub-£1m flat will have vanished from prime areas of the West End in less than two years. And, he says, if you want to buy a whole house, you’re looking at a minimum of £2m — 80% already go for more than £10m. This is a trend that’s unlikely to trouble many beyond a few hallowed central London postcodes any time soon. Figures from Savills estate agency show that only 1.6% of all property sales in England and Wales last year were for more than £1m. Even in the capital, the total was only 8.5%. The southeast was the only other region where seven-figure sales accounted for more than 1% of the market — though the Land Registry, on which the figures are based, undercounts the number of sales at the top end. There have been signs of a downturn in the luxury London market, but Mayfair seems to be holding up well: homes there fetched an average of £4.8m last year, up from £4.5m in 2014. Transactions, a good indicator of future price changes, have also increased by 8.2% in the past year. “The continuing upsurge in values is a reflection of global demand and the shortage of supply, as well as the increase in super-luxury apartment schemes,“ Wetherell says. “Despite the economic triple whammy of falling oil prices, China’s economic slowdown and stamp-duty changes, the appetite among high-net-worth buyers for housing stock in Mayfair has continued to rise. ”It’s a cautious market at the moment, but the area is an attractive, lucrative island of stability for investors.” Anyone who bought into Mayfair 30 years ago will certainly have seen a healthy return. In 1985, more than 90% of homes there were priced below £1m, and you could pick up a one-bedroom flat for between £85,000 and £150,000. A two-bedder on Balfour Place that was on the market then for £225,000 is now for sale again — this time valued at more than £2m. This article originally appeared on The Sunday Times.