Property investments in London are likely to attract more overseas investors, as the UK Britain decides whether to stay in the European Union.
Uncertainty ahead of the EU referendum has seen sterling’s value plummet against major foreign currencies in the recent weeks, as investors show greater concern over the outlook for sterling than at any time in the last six years in a sign of increasing nervousness about the outcome of June’s vote on Britain’s membership of the EU.
However, in spite of the pound’s instability, property prices across many parts of London are still rising, albeit at a slower rate of growth, and more overseas investors are starting to take note.
Mark Elliott, associate director of international residential property services at JLL, told the press that currency movements do not necessarily have an immediate relationship on property prices, and investors are not concerned as the Brexit vote draws closer.
“[Overseas investors] are not concerned and rightly so as demand is still there as is a huge undersupply [of properties in London],” said Elliott, who believes that investor confidence in the London property market has been buoyed by HSBC’s decision to keep their headquarters in London.
“I think a lot of buyers are following the lead of the due diligence [HSBC and other blue chip institutions] must have done,” said Elliott. “Coupled with a weak pound there is still some great opportunities [for overseas property investors].”
Camilla Dell (pictured), managing partner at Black Brick, also believes that a weakening currency exchange rate provides foreign property investors with a window of opportunity to snap up properties in London at a discounted rate.
“In Knightsbridge prices are more than a quarter lower in dollar terms than they were 18 months ago,” she said.
“Opportunity is the other side of the coin to crisis,” Dell added. “It’s certainly tempting some overseas buyers back into the market.”