New research reveals that subterranean living continues to drive extraordinary premiums in the capital’s most exclusive postcodes, with basement properties in Westminster commanding as much as 122% more than the borough’s average home.
The analysis, conducted by prime residential brokerage Jefferies London, highlights the growing demand for luxury basement space among high-net-worth buyers in central London, despite limited supply and often complex planning considerations.
Across the capital, properties featuring a basement are listed at an average asking price of £1.2 million – nearly double (97%) the average across all property types.
But it is in Westminster where the gulf is greatest, with basement homes commanding an average of £2.76 million compared to £1.25 million for the wider market.
ICEBERG HOMES
Kensington and Chelsea, long associated with expansive “iceberg homes”, sees a 100% premium for basement-equipped properties. In Camden, the uplift stands at 98%.
These so-called mega-basements – often housing swimming pools, cinemas, wine cellars, or even ballrooms – have drawn scrutiny in recent years due to the disruption caused by extensive excavations.
The returns on such developments can be considerable.
Nonetheless, for homeowners with limited scope for outward expansion, the returns on such developments appear considerable.
Yet scarcity remains a defining feature of the segment. Across Greater London, homes with basements make up just 3% of all listings. Even in boroughs where they are most prevalent, such as Hammersmith and Fulham, they account for only 5% of the market.
Kensington and Chelsea and Camden both report 3% of current listings offering basement space, while the City of London trails the capital with just 1% – reflecting both physical constraints and the area’s commercial character.
For buyers seeking additional square footage below ground, the data suggests that exclusivity, more than excavation, drives value in today’s prime London market.
CONTROVERSIAL CONTRUCTION = PRICE PREMIUM
Damien Jefferies, Founder of Jefferies London, says: “Whilst their construction may have caused controversy in recent years, the mega-basement continues to be a feature that many prime homeowners are keen to implement as it tends to be the only viable option when it comes to adding serious additional space to a home that is otherwise limited in this respect.
“These often multi-story additions are utilised for a range of luxury purposes from swimming pools to cinemas and even wine cellars and it’s clear that they add serious value, whether it’s a property that has already been converted, or simply one offering the ability to do so.
“However, the real issue isn’t the premium such properties command but their availability in the current market, with such homes making up around five percent or less of current prime property listings depending on where you’re looking to buy.”
