Liam Bailey
New York
Knight Frank's Global Head of Research. UK and international housing market commentator.
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Articles by Liam Bailey
The Bank hikes as oil drops below $100
The Bank of England's decision to raise the base rate to 4% yesterday, the first rise in three years, prompted a shift in the outlook. Eight of the nine members of the Monetary Policy Committee voted to hike, which is a little more hawkish than economists had anticipated. Traders now see a 50% chance of a rise in December and expect almost three more before the end of next year.
The politics of property, from Texas to Greece
The conflict in the Middle East raised difficult questions for the region's financial centres, most notably Dubai. Missile and drone attacks had the potential to puncture the city's reputation as a safe haven in a volatile region. But while the war has weighed on tourism, the prime residential market has remained resilient. Super-prime sales - those priced at US$10m or more – hit 86 in the third quarter, down from 103 in the same period last year, when the market was at its peak.
Beyond the piste: a new vision of Alpine luxury
The mountain property market has rarely looked so robust, or so uneven. Skier visits have reached a record 399 million globally, including 168.5 million in the Alps. Yet residential price performance in these markets is diverging sharply. Almost 18 percentage points separate the strongest and weakest resorts in our Mountain Property Price Index, released yesterday as part of The Alpine Report 2026/27. It is a market driven increasingly by resort-specific fundamentals.
Inflation bites as the Budget approaches
UK inflation climbed to 3.5% during the year through September, up from 3.1% the previous month, amid a spike in petrol and diesel prices. That's an 11-month high and slightly higher than the 3.4% economists expected. A rate hike to 4% at the Bank of England's November meeting now looks very likely indeed. Official figures published yesterday showed unemployment fell unexpectedly and wage growth picked up during the three months through August.
The trillion-dollar bet on data centres
The global data centre market is entering a period of dramatic expansion. Some 48 gigwatts of capacity – the amount of computing power data centres can support – will be delivered between 2026 and 2029, a 77% increase in global supply volumes, according to Knight Frank's Data Centre Atlas. AI supply volumes are set to expand to 27GW, from 8GW, making the sector responsible for almost a quarter of operational data-centre capacity.
The gulf between ambition and delivery in the London new homes market
Housebuilding policymakers in the UK tend to have a habit of setting very ambitious targets without providing the policy foundations to meet them. The draft London Plan sets a target of 558,451 new homes to be delivered between 2027 and 2036, which equates to roughly 55,845 homes each year. New data from Molior London illustrates how much of a stretch that is going to be.
Taylor Wimpey on the capital's "fundamentally broken" development market
Taylor Wimpey won't be buying more land in London once its current pipeline is complete, chief executive Jennie Daly told The Times' The Business podcast this week. The economic case for doing so "has evaporated," she added, citing costly policies such as a requirement to build second staircases in buildings over 18 metres, late-stage reviews, the fact that off-plan investors have been taxed out of the market and the risks stemming from the planning system.
Spain's political crisis shows why there are no quick fixes for housing
Across Europe, governments face expensive problems but have little money to solve them. Pressure to increase spending on defence, boost public services and tackle housing affordability is pushing administrations to breaking point with increasing regularity. Spanish Prime Minister Pedro Sánchez called a snap election for 29th November this week following weeks of protests over housing.
Miami project's US$1.7bn off-plan sales underline America's wealth boom
No country creates UHNWIs like the US. During the five years to 2026, 41 per cent of all new individuals worth at least US$30 million were minted there, and the US is home to 35 per cent of the world’s UHNWI population, according to the 2026 edition of The Wealth Report. The sheer pace and scale of wealth creation is concentrating activity at the very top of the country's prime residential markets, and sales records are being broken with increasing regularity.
The return of Help to Buy
This week's announcement of a first-time buyer scheme echoing Help to Buy prompted a sharp rally in UK housebuilder shares, and for good reason. Barratt Redrow rose 16% on Monday, the day Prime Minister Andy Burnham revealed that buyers will need deposits of just 2.5% to buy a new home, while the government will provide loans of up to 20% of a property's value. Persimmon climbed 17%. Taylor Wimpey surged 23%.
Europe's luxury housing squeeze
Prime residential transactions in Italy surged 140% year-on-year during the eight months through August, according to new Knight Frank data, highlighting the government's success in attracting wealthy individuals with large overseas income and assets. Italy's flat tax regime, which allows individuals who transfer their tax residence to Italy to pay a fixed €300,000 a year on foreign income for up to 15 years, now has 5,000 participants - up from 3,000 two years ago.
Luxury's new scarcity
On a bitterly cold Paris morning in mid-December 2018, LVMH announced a US$3.2 billion deal to acquire Belmond, then owner or operator of 46 of the world’s best hotels, restaurants, trains and yachts. At the time, it could have looked like another trophy acquisition for Bernard Arnault’s expanding luxury empire. With hindsight, it seems rather more prescient.
A US$200m penthouse and the new economics of luxury homes
Investment manager Cain is selling Aman-branded homes at its One Beverly Hills development for an average US$7,000 per sq ft, in line with some of the most expensive homes in London. For The Residence Report 2026/27, published this week, we asked CEO Jonathan Goldstein to discuss the scheme and its pricing. He invoked the economics of luxury goods, where the right brand can untether price from more conventional measures of value.
Risers and fallers in the global super-prime reordering
Global super-prime (US$10 million-plus) sales fell to 572 during the second quarter, down 7% from the revised Q1 total and a 6% fall compared to the same period a year earlier, according to Knight Frank's Global Super-Prime Intelligence report. A redistribution of momentum between markets was the defining feature of the quarter. Dubai retained first place by both transaction count and aggregate value, recording 131 sales worth US$2.17 billion.
The New Scarcity: Liam Bailey on the evolution of luxury & what today’s HNW property buyers really value
This content is available only to PrimeResi Members. If you have a membership login below, otherwise join Prime Resi today for full access to the Journal of Luxury Property. Remember Me Main image: Image via Belmond (Cipriani Hotel, Venice)
Signs of a turn in the UK housing market?
The summer produced a run of subdued housing market data. Mortgage approvals for home purchases are running about 8% below the six-month average and house price growth has slowly ebbed away. More timely indicators suggest this could mark the bottom. The RICS Residential Market Survey, published yesterday, produced less negative readings for buyer enquiries, agreed sales, and metrics covering expectations of sales and housing price growth.
Another billionaire says goodbye
Chris Rokos, the billionaire investor and founder of the hedge fund Rokos Capital Management, is moving his tax residency from the UK to Greece. His firm, which manages about US$22 billion, will open an office in Athens.
The million sq ft question facing the City of London
London's protected views have long shaped the scale and design of the city's skyscraper clusters. The Leadenhall Building’s distinctive tapered design, which earned it the nickname ‘The Cheesegrater’, preserves an uninterrupted view of St Paul’s Cathedral when viewed from Fleet Street, for example.
A warning from global bond markets
A global selloff of government bonds sent benchmark yields to multi-decade highs this week as investors fret over inflation and fiscal credibility. Long-term bond yields in the US and the UK are at peaks not seen since the Global Financial Crisis. Borrowing costs in Germany are at a 15-year high. The Japanese benchmark bond yield is on the brink of hitting 3% for the first time since the mid-1990s.
Tax speculation takes its toll
“This tax-raising budget may be ¬almost as big as the last, but with the balance tilted away from hikes on businesses seen in recent years towards tax hikes on capital, wealth and income,” Ruth Gregory, deputy chief UK economist at Capital Economics, said in a much-covered research note this week. Prime Minister Andy Burnham must find £25 billion in the October Budget to fund his pledges, the economics consultancy reckons.
Branded residences follow the money
Between 2021 and 2026, the global population of UHNWIs (those worth more than US$30 million) rose from 551,435 to 713,626. That equates to 162,191 new UHNWIs in just five years – or 89 people, somewhere in the world, crossing the US$30 million threshold every single day- see p.8 of The Wealth Report 2026.
The summer slowdown deepens
Slow summers aren't unusual in the UK property market, but the surge in mortgage rates since the conflict in the Middle East began has sapped more momentum, raising questions about how quickly activity will recover in the autumn. UK house prices edged up 0.1% in July, up from June's flat reading, Nationwide reported this morning. That brings the annual growth rate to 1.8%, down from 2.2% a month ago. Transactions have also weakened.
Luxury housing markets regain momentum
The prospect of Andy Burnham's move into Downing Street and England's progress in the World Cup provided the biggest lift to consumer confidence since 2023 during July, market research group GfK reported on Friday. Public confidence is now higher than it was at the start of the Iran war.
The property opportunity behind the AI boom
In 2021, Daniela Amodei, Dario Amodei and a handful of colleagues left OpenAI to start their own fledgling artificial intelligence (AI) firm. Just five years later, that startup – Anthropic – employs thousands of people, commands a US$900 billion valuation and in April signed a lease for 158,000 square feet at One Triton Square. The breakneck expansion of these AI firms is something to behold.
Signs of life in the UK housing market
UK house prices returned to growth for the first time in four months in June, Lloyds reported yesterday. The 0.2% gain brings the annual growth rate to 0.6%. While that’s lacklustre, it does suggest the market is beginning to turn more positive after mortgage rates rose following the conflict in the Middle East. Lenders granted just 56,205 mortgages to homebuyers in May, down from 66,034 the previous month, according to Bank of England data released last week.
Super-prime's centre of gravity shifts
Elevated financing costs and persistent policy uncertainty have done little to slow the very top end of global residential markets. Activity across the 12 markets tracked by Knight Frank’s Global Super-Prime Intelligence report climbed to its highest level in a year during Q1, led by sharp rebounds in Dubai, New York, Hong Kong, Palm Beach and Singapore. There were 636 US$10 million-plus transactions during the period, up 14% compared to the previous quarter.
The housing market loses momentum
UK property market activity is wilting in the face of elevated mortgage rates and domestic political volatility. Lenders granted 56,200 mortgages to homebuyers during May, well down from the 66,000 registered in April and the lowest level since December 2023, the Bank of England (BoE) reported this week. Meanwhile, inquiries to estate agents via Zoopla fell 15% during the past four weeks compared to the same period a year earlier, according to data shared with the Times. Agreed sales were down 7%.
Oil's return to pre-war levels shifts the outlook
Yesterday, the price of Brent crude oil fell below its level on the day the Iran war began. The benchmark price dropped to US$72.40, from a peak of US$126 in March, crossing a symbolic threshold that suggests investors have now priced out the risk of a sustained, war-driven inflation shock. Traders now expect one hike from the Bank of England this year, down from two a fortnight ago. Similarly, the ECB is expected to raise rates just once by the end of the year.
Burnham’s victory ushers in fresh uncertainty
Greater Manchester mayor Andy Burnham won a decisive victory in the Makerfield by-election overnight, taking 55% of the vote and initiating yet another period of political uncertainty that will hang over investment decisions. Should Prime Minister Kier Starmer refuse to step down – as he has indicated so far – an official contest triggered in the next week or two would last through the summer, with a new leader likely crowned at the Labour conference in September, according to the FT.
Investors begin to look beyond the conflict
Oil dropped below US$80 a barrel for the first time since March yesterday following the US-Iran deal to reopen the Strait of Hormuz. While it’s true that the deal is fragile, and critics like the European Central Bank are right to point out that the conflict will leave scars, a sizeable repricing is underway; stocks surged and bond yields eased as investors have pared bets on central bank rate hikes.
Central banks begin to confront the energy shock
Shares in Asia-Pacific surged overnight and oil dropped below US$90 a barrel after US President Donald Trump announced that a deal with Iran to open the Strait of Hormuz could be signed as soon as this weekend. After four months of false dawns and reversals, weary investors could be forgiven for tuning it out. But the conflict remains the most tangible threat to the global economy – and some central bankers aren't waiting to find out whether an end is near.
Three months into the US-Iran war, the economic costs are becoming clear
AI-hype and strong US corporate earnings pushed global stock markets to record highs this week. Three months into the US-Iran war, equity investors appear unbothered – but the economic scarring is becoming harder to ignore. The dilemma the conflict poses to central banks was encapsulated by the closely watched UK Services Purchasing Managers Index from S&P Global on Wednesday.
Hong Kong’s resurgence reflects a new wealth order
The S&P 500’s blistering rally and the prospect of blockbuster IPOs from the likes of SpaceX, Anthropic and OpenAI suggest that the US will once again create wealth at a pace unmatched by any other hub during 2026 – and indeed well beyond that. Our Wealth Report 2026 forecasts (P.8) showed that America will be home to 41% of the world's ultra-high-net worth population by 2031, up from 35% today. Every country will hold a smaller share by then to accommodate the relentless expansion of the US.
AI and real estate: from Regent's Place to outer space
Power is among the data centre sector's key constraints. In Europe, demand for electricity from data centres is likely to surge 150% by 2035, according to energy think tank Ember. Connections are painfully slow; it takes an average of seven to ten years to connect a data centre to the grid in legacy hubs.
A new tax and a familiar message
The government is considering adding an extra surcharge on top of the new mansion tax for non-UK residential property owners, according to a consultation document published yesterday. From April 2028, owners of homes worth more than £2 million will be liable for the "high-value council tax surcharge". The proposed levy would sit on top and apply only to owners who are not UK tax residents.
Investors confront another policy vacuum
UK government borrowing costs touched new multi-decade highs yesterday due to a combination of political uncertainty and signs that the US/Iran ceasefire is wobbling. Investors in UK real estate across sectors must once again make decisions with little clarity as to how their investments or tenants will be taxed in the coming months, which will undoubtedly weigh on activity.
Labour’s local election reckoning
Long-term government borrowing costs hit a 28-year high earlier this week on concerns that Prime Minister Keir Starmer will face a leadership challenge should Labour fare poorly in this week's local elections. So far, Starmer's worst-case scenario is playing out. At the time of writing, Labour is on track for record losses.
Hong Kong’s prime market turns a corner
We may look back on the early months of 2026 as an inflection point in prime residential property markets. The rise of challengers to the world's most established wealth hubs was among the major trends of the post-pandemic period, but seemingly perpetual geopolitical volatility is prompting the wealthy to look again at cities that have seen outflows in recent years. Hong Kong is perhaps the best example.
The government takes rent controls off the table – again
The government is not considering a one-year rent freeze in England, a government spokesman told the FT yesterday. Those comments followed a report in the Guardian earlier this week that the policy was on the table as a means to support household budgets as costs rise due to the conflict in the Middle East.
Twenty years of The Wealth Report – lessons from two decades of change
Private investors today face a more fractured and complex world than at any point since the publication of the first edition of The Wealth Report in 2007. The past two decades were characterised by falling inflation, abundant liquidity and an increasingly globalised economic system. Now, that environment has shifted decisively.
AI leasing reinforces London's pull
The UK's annual rate of inflation picked up to 3.3% in March, up from 3% the previous month, driven largely by an uptick in the price of fuel due to the conflict in the Middle East. The rise was in line with economists' expectations, so is unlikely to have a meaningful impact on borrowing costs in the short term. The data only captures the early weeks of the conflict, which began on February 28th.
New York joins the push to tax property wealth
New York looks set to become the latest city to introduce a tax on prime property as it seeks to close shortfalls in its municipal budget. The proposal to tax second homes worth more than $5 million is the first of Mayor Zohran Mamdani’s ‘tax the rich’ measures to gain backing from Governor Kathy Hochul. Mamdani does not have the authority to raise taxes unilaterally and therefore requires support from both Hochul and the state legislature.
The case for new housebuilding stimulus
What can the government do to turn around the UK’s residential development market? Housing output remains weak across the board – in cities like London, it is at crisis levels – despite a series of supply-side policy interventions since this government was elected in 2024. Affordability remains the missing piece of the puzzle – it's improved markedly over the past year, but not enough to bring homes within reach of the average buyer.
Prime London lettings buck the trend as demand builds
The conflict in the Middle East is weighing on demand for residential real estate, with one notable exception: the prime central London lettings market. The number of prospective tenants that registered in March was 16.6% higher than the same month in 2025, according to new Knight Frank figures. For properties valued at more than £1,000 per week, the increase was 16.9%. There are a few things going on here.
Ceasefire shifts the outlook for rates and property
Oil prices fell steeply and stocks surged overnight after US President Donald Trump announced a two-week ceasefire with Iran. The agreement includes safe passage for ships through the Strait of Hormuz. Brent crude fell 13% to about $95 per barrel at the time of writing, feeding a reassessment of the path of interest rates. US swaps indicate around a 60% chance the US Federal Reserve will cut rates by year-end, up from almost zero at the start of the week, according to Bloomberg.
Pre-conflict housing data points to a recovery – does it still matter?
Fresh data covering mortgage lending and house prices suggests the housing market was recovering steadily in the weeks before the Middle East conflict began. It's tempting to dismiss it as irrelevant, given how conditions have changed, but recent weeks have demonstrated that sentiment can turn quickly – both for better and worse. President Donald Trump told reporters yesterday that the US planned to wrap up its military campaign in Iran in two or three weeks.
A push to restart London housebuilding
How much economic pain can US President Donald Trump endure in the run-up to the midterm elections in November? Consensus in the early days of the conflict was that America was relatively isolated from the worst effects of the energy crisis – imports account for less than a fifth of its total energy supply, the lowest share since the 1980s. That argument has steadily weakened as the conflict has dragged on, and new projections from the OECD lay bare the impact on the American consumer.
Relief rallies meet lingering risks
Welcome to another day of conflicting signals. Oil is trading back near US$100 a barrel, down from around US$115 on Monday. Earlier this week, US President Donald Trump said he had postponed plans to bomb key Iranian energy sites. Overnight, the New York Times reported that the US had delivered a fifteen-point plan to end the war, while Israeli TV suggested Washington was seeking a month-long ceasefire.
Conflict and mobility – early signals from Knight Frank
The United Arab Emirates plans to allow expats to spend more time abroad without losing their lucrative tax status, the FT reports this morning. People who have left the country since the start of the conflict are likely to be shown greater leniency, the paper says, citing people briefed on the plans. This is likely to be the beginning of a broad campaign to shore up the UAE's attractiveness among expats, who make up the large majority of the population.
Volatility spreads from oil to mortgages
Oil prices fell by the most in four years yesterday to less than US$90 a barrel and government borrowing costs eased. Attempts by US and European administrations to calm markets, alongside reports of a massive release of oil reserves by the International Energy Agency, have worked to some degree, though markets remain febrile. More than ten days since the conflict began, the outlook is so uncertain that it's still only possible to discuss scenarios.
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