The number of residential mortgages worth £5 million or more rose last year as wealthy buyers increasingly used borrowing to fund prime property purchases, according to Karis Capital.
Data supplied by the Financial Conduct Authority to the specialist real estate finance advisory firm showed 333 regulated mortgages of at least £5 million were completed in the year to 31 March 2026, up from 313 in the previous year.
The combined value of those mortgages reached £3.3 billion, putting the average loan at approximately £10 million.
Karis Capital said the figures reflected a shift in the luxury housing market, with some wealthy buyers choosing to retain capital rather than purchase properties entirely with cash.
London continued to account for the overwhelming majority of high-value lending. Of the 333 mortgages worth at least £5 million, 292, or 88%, were secured against properties in the capital. That compared with 263, representing 84% of the total, in the previous year.
Only eight of the mortgages were secured against properties outside London, the South East and the South West.
Francesco Amato, senior debt advisor at Karis Capital, said: “The increase in mortgages worth £5 million or more reflects a change in how wealthy buyers are approaching the luxury property market.
“Even when wealthy people have cash to buy luxury properties, many are choosing to borrow because it allows them to preserve capital for other investments.”
PRIME LONDON PRICES FALL
Karis Capital also pointed to falling prices in parts of central London as a factor encouraging renewed interest in luxury residential property.
ONS data cited by the firm showed house prices had fallen by as much as 22.8% in Westminster and 10.7% in Kensington and Chelsea over the previous year.
The firm said lower values were bringing some properties within reach of a wider group of buyers and attracting ultra-high-net-worth investors expecting prices to recover over the longer term.
It added that prime London property continued to attract overseas demand, including buyers based in the UAE, Hong Kong and Singapore.
Amato said: “London remains one of the world’s premier destinations for international wealth and continues to attract buyers from across the Middle East and Asia. Whilst the change in the non-dom rules has had an impact many see the current drop in luxury property offers compelling long-term investment opportunities.”
He added that arranging finance for purchases at this level involved considerations beyond headline pricing.
Amato said: “Luxury property finance is a highly specialised area of the market. Borrowers often have complex income structures, international assets or bespoke lending requirements.
“A tailored borrowing plan can make a big difference to both the speed of a luxury property purchase and the overall outcomes and returns.”
