The white palazzo-style building, which has 45 bedrooms, is being discreetly offered to a select group of wealthy international buyers.
A reported price tag of £300 million would smash Britain’s existing house-price record of £140 million, which was achieved on a 300 year-old house in Henley-on-Thames last year.
OK, vastly expensive palace in London. But is the expense actually unusual?
The asking price shows just how far adrift the London property market is from the rest of Britain. According to Halifax, the average house in the UK costs £160,250, meaning that whoever buys the mansion would be buying the equivalent of 1,872 typical homes.
The house seems very like one of the vast Ducal palaces more than anything else. The London palaces, not the country ones.
The question being, historically, was 2,000 times the cost an unusual multiple between such palaces and the average home? I have no idea but does anyone else?
12 responses so far ↓
1 john b // Sep 14, 2012 at 8:39 am
Mad George paid gbp21k for Buck House. Annual rent for a small house at the time was gbp10 (can’t find any data on how much they actually sold for).
Assuming 5% yield, the small house was worth gbp200, and hence the gap was 100x rather than 2000x.
2 Shinsei67 // Sep 14, 2012 at 8:44 am
Interesting question, but the major difference between this and one of the great ducal palaces is that they were built as one single house. And by a great architect of the day. This was originally built as four houses and then knocked into one. And it shows.
Also shows what a bargain Laksmi Miital got in 2004 when he bought Bernie Ecclestone’s house in Kensington Park Gardens for £60m.
The same size building (60,000 sq ft) and Mittal also got a garden.
3 Shinsei67 // Sep 14, 2012 at 8:57 am
Devonshire House on Piccadilly with its three acres of garden was sold in 1920 for £750,000.
According to google you could pick up a cottage in 1920 for £250 (about 3x a farm labourer’s wage) and a house for £500.
4 Shinsei67 // Sep 14, 2012 at 9:09 am
The badly fire-damaged Northumberland House was sold to the Metropolitan Board of Work in 1866 for £500,000 who then demolished it to build Northumberland Avenue.
5 Surreptitious Evil // Sep 14, 2012 at 9:38 am
So pace #3 & #4, it’s up but not catastrophically up on C19 & early c20, but #1, a long way up on the mid-C18 (unless the King got an awfully good deal.)
6 James James // Sep 14, 2012 at 9:52 am
“Assuming 5% yield”
Yields back then could be much higher, more like 20%, I think. Not sure what the yield on a small house would be, but even at 20% the gap would still only be 400x, not 2000x.
7 Nautical Nick // Sep 14, 2012 at 10:17 am
Of course, it hasn’t been sold yet. My more modest dwelling is also available at £300 million….
8 Shinsei67 // Sep 14, 2012 at 10:28 am
Of course there wasn’t 7% stamp duty (or 15% if bought by a corporate) on ducal palaces back in the old days.
I wonder if this will have any impact on the level of demand.
9 Chris Gilmour // Sep 14, 2012 at 11:40 am
Buckingham Palace was worth £11million in 1952 and average house prices were £1,520
Now Buckingham Palace is valued at £1billion and the average house price is £160,000
So the ratio sixty years ago was about 7000 times and now its about 6000 times.
http://blogs.independent.co.uk/2012/05/31/buckingham-palace-has-gone-up-9000-in-value/
http://www.thisismoney.co.uk/money/mortgageshome/article-2144226/Average-house-price-risen-100-times-Queen-crowned.html
10 Surreptitious Evil // Sep 14, 2012 at 3:02 pm
HTF did the Nationwide “estimate” the value of Buck House and Windsor Castle? Both now and looking back 60 years?
Sounds like “decide what we want to ‘prove’ and invent the numbers to prove it.”
11 Nick Luke // Sep 14, 2012 at 5:12 pm
From Wikipedia… so no idea how true this is.
“Buckingham House
The house which forms the architectural core of the present palace was built for the first Duke of Buckingham and Normanby in 1703 to the design of William Winde. The style chosen was of a large, three-floored central block with two smaller flanking service wings.[17] Buckingham House was eventually sold by Buckingham’s descendant, Sir Charles Sheffield, in 1761[2] to George III for £21,000[18] (£3,000,000 as of 2012).[19]
Like his grandfather, George II, George III refused to sell the mulberry garden interest, so that Sheffield had been unable to purchase the full freehold of the site. When Sheffield sold Buckingham House it came into the hands of the royal family.”
The Royal speculator, like many today knew the value of a blocking (‘Cambridge’) ownership.
It would seem he drove a hard bargain as he was just about the only purchaser.
12 Nick Luke // Sep 14, 2012 at 5:22 pm
As a comparison, Blenheim Palace , built on land gifted to John Churchill by the state, was part built at a cost of £265 000 at the date of the Churchill’s retreat to France in 1712. No note is given in the guide book as to the completion costs, born by J.C. until his death and thereafter overseen by his formidable Duchess.
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