The Regent’s Park house designed by Buckingham Palace architect is being sold for £130m, £50m below the asking price

A covetable London mansion overlooking iconic Regent’s Park has reduced its asking price of £180m by £50m, suggesting that even the higher end of the capital’s housing market is feeling the effects of the economic downturn.

Indian businessman Ajay Kalsi is said to have snagged the Grade 1 list 1-18 York Terrace East – which has approval to be converted into 26 apartments and two houses – for just under £130million.

The lower price signals that London is feeling the effects of rising inflation, interest rates and less affluent Russian investors, who have largely deserted the UK since Vladimir Putin invaded Ukraine.

Designed by Buckingham Palace architect Josh Nash, the 95,000-square-foot row of houses originally had a much higher price tag, but the sale is said to be a “huge relief” for real estate firm Zenprop, which bought the building in 2016. reports Financial Times.

The desirable Grade II listed 1-18 York Terrace East in London has been sold for £50m deducted from its asking price of £180m

The desirable Grade II listed 1-18 York Terrace East in London has been sold for £50m deducted from its asking price of £180m

Zenprop originally intended to develop the property and sell it for a profit, but that plan was dashed by Brexit, then the pandemic and most recently the war in Ukraine, all of which have contributed to inflation, rising interest rates and construction costs, according to a person with knowledge of sale.

“You just bought it [the property] then you hit the concrete wall of building costs rising daily for brick, cement, wood, everything.

“Building-costs [could be] well over £1,000 per square foot,” said a person involved with the transaction.

In addition, experts predict a general sharp decline in real estate prices while mortgage rates are rising and the cost of living is skyrocketing.

Amid concerns a “Day of Judgment” is imminent, analysts expect a 7 percent fall over the next two years, with London and the South East being hit even harder.

The real estate market in general has been booming since the pandemic, with prices hitting record highs.

But signs of a slowdown are emerging and forecasts for 2023 and 2024 are becoming increasingly bleak.

Indian businessman Ajay Kalsi is said to have bought the John Nash-designed building from real estate firm Zenprop

Indian businessman Ajay Kalsi is said to have bought the John Nash-designed building from real estate firm Zenprop

For “prime” real estate, the decline may already have begun. Average prices in this class in London are 17.6 per cent below their 2014 peak, according to estate agent Savills.

The impact of less affluent foreign buyers in the capital willing to take on large development projects is also taking its toll on the luxury segment of the market.

Many have left during the pandemic and have yet to return, while Russian investors were once numerous but have dwindled in number since the invasion of Ukraine.

The opulent interior of York Terrace East in London designed by Buckingham Palace architect John Nash

The opulent interior of York Terrace East in London designed by Buckingham Palace architect John Nash

The Grade I listed 1-18 York Terrace East is 95,000 square feet and has permission to convert into 26 apartments and two houses

The Grade I listed 1-18 York Terrace East is 95,000 square feet and has permission to convert into 26 apartments and two houses

Average prices for “premium” homes in London are 17.6 per cent below their 2014 peak, according to estate agent Savills

Average prices for “premium” homes in London are 17.6 percent below their 2014 peak, according to estate agent Savills

“There are obviously no Russians, few Chinese and very few Arab buyers,” said Andrew Langton, chairman of Aylesford International, the company that markets York Terrace East alongside Savills.

Analysts at Capital Economics have forecast a two-year downturn, with house prices falling by around 5 percent in 2023 and another 2 percent in 2024.

The market research firm predicts that demand will fall as rising mortgage rates, high inflation and a looming recession weigh on budgets and buyer confidence – causing property market activity to plunge to its lowest level in over a decade in 2023 becomes.

However, some analysts remain optimistic. Property website Twindig’s Anthony Codling said: “We tend to overestimate the likelihood of bad things happening. House prices have fallen in just 16 of the last 91 years.

‘Once we’ve won the battle against inflation, we can expect prices to continue to rise.’

https://www.dailymail.co.uk/news/article-11176725/Regents-Park-home-designed-Buckingham-Palace-architect-sells-130m-50m-asking-price.html?ns_mchannel=rss&ns_campaign=1490&ito=1490 The Regent’s Park house designed by Buckingham Palace architect is being sold for £130m, £50m below the asking price

Emma Colton

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