Kensington Palace Gardens home is ultimate dream for billionaires

Kensington Palace Gardens in London is one of the most exclusive places to live anywhere on earth and prices are rocketing. Owning a home there is the ultimate property status symbol.

The average house price in Kensington Palace Gardens is estimated at £19.2 million. Oli Scarff / Getty Images

Separated off from the busy main roads by imposing wrought iron gates and armed police checkpoints, Kensington Palace Gardens is the place where the rich and famous dream of living.

The almost 1km long tree-lined avenue of Italianate and Queen Anne-style mansions close to the palace home of Prince William, Kate Middleton and their new son Prince George, is one of the most exclusive - and expensive - addresses on the planet.

You don't have to be a billionaire to buy a house in this well-established address, but multimillionaires may blanch at the prices.

According to press reports last month, Prince Abdul Aziz bin Fahd, the son of the late King Fahd of Saudi Arabia, instructed Knight Frank to market his luxury pad on the street for an estimated £150 million (Dh864m).

The average cost of a house on the street, which was laid out in 1843, stands at £19.2 million - 93 times the UK average - according to the property sales website Zoopla.

Forget the film stars and their mansions in Beverly Hills, to live here you need assets in the oligarch league, sums more in line with a small country's annual income.

Overseas governments including those of Russia, India, France, Nepal, Finland, Lebanon, Kuwait, Japan, Slovakia, the Czech Republic, Romania and Norway own many of the long-leasehold properties as either embassies or ambassadors' residences.

The Russian oligarch and Chelsea Football Club owner Roman Abramovich lives at number 17. The model Tamara Ecclestone, the daughter of Formula One boss Bernie Ecclestone, lives at number 8.

Other residents include the Sultan of Brunei, Hassanal Bolkiah, who has had a home here since 1989, and the founder of Foxtons estate agents, Jon Hunt, who bought his house in 2005 for £15.7m.

The street has also become a focus for Middle East money and it is understood at least 10 of the properties on the street are owned by members of the Saudi royal family.

Estate agents are divided on exactly how much the few dozen Victorian mansions on the street, which runs between High Street Kensington and Notting Hill Gate, would cost in total.

"It is still the most popular and most expensive street in London and we would value the entire street at around £2.8 billion," says Jonathan Hewlett, the head of London residential at the upmarket estate agent Savills.

"We would estimate that you would be looking at around £3.25bn because it's a trophy asset," says Ed Mead, a director at the rival estate agents Douglas & Gordon.

Even the lower estimates put the street's value at about the same monetary value as the annual GDP of Barbados.

And that is not including Kensington Palace itself, the royal residence of the Duke and Duchess of Cambridge, Prince George of Cambridge, Prince Harry, the Duke and Duchess of Gloucester and Prince and Princess Michael of Kent.

It is unlikely to be ever put up for sale but property brokers estimate if that came to the market, this grand block of regal apartments could cost at least £1bn.

Agents say Kensington Palace Gardens' owners regularly receive eye-popping offers for their properties and, on the rare occasions one of these homes does come to the market, it attracts global attention from a small but elite group of household names.

And as central London values soar, even governments are coming under pressure to sell up to the super rich and move to less established locations in the city such as the new Embassy Quarter development south of the river.

In 2004 the Russian oligarch Leonard Blavatnik bought number 15 Kensington Palace Gardens by acquiring three former Russian embassy buildings for £41m.

And in 2008 the Indian steel magnate Lakshmi Mittal, who owns 41 per cent of ArcelorMittal, the world's largest steel making company, paid £117m to buy the long leasehold of 9A, the former embassy of the Philippines, making it the most expensive house in the UK at the time.

This year the Nepalese government has revealed it is controversially considering selling its embassy at 12A, which doubles up as an official ambassadorial residence.

Government officials sent a committee to London to explore the option of offloading the mansion, which was gifted to the Nepalese in 1937 by the British in thanks for the Gurkhas' role in the First World War and other campaigns.

Such a deal could fetch the developing country as much as £150m despite the fact that the property has had little maintenance for 50 years and is said to require more than £5m of repairs.

Agents representing Mr Mittal are understood to have already expressed an interest in the property and other key names are also said to have been privately approached.

However, the Nepalese government says it is still making up its mind about the future of the 2,970 sq metre historic house, which Gurkhas regard as a key part of their history.

"I want to make it clear to you that the government has not taken any decision, so it all depends on the recommendation of the team," the Nepal foreign ministry spokesman Arjun Thapa told the BBC this year.

Because of international media interest, potential buyers have even been asked to sign confidentiality agreements before they even get to look at the house.

So why is Kensington Palace Gardens - or KPG as London estate agents like to call it - such a sought after address?

Local agents say the high police and diplomatic security on the street, coupled with a lack of traffic and its location right in the heart of west London, attracts those hunting for the very best in London property.

"It's a trophy address, possibly the best there is," says Ed Mead, a director at Douglas & Gordon.

"In the same way a hotel like the George V in Paris sells for far more than its real value - trophy assets attract a premium that doesn't correlate with the intrinsic value of the property," he adds.

"And in a world where 'mine's bigger than yours' is what counts, they don't come much bigger than this. "