Property investors from India have become the second largest purchasing group in Prime Central London (PCL). 

According to investment firm London Central Portfolio (LCP), Indian investors now account for 22% of sales in the PCL market.

The surge comes following a relaxation of rules around the amount of capital Indian residents could remove from the country. 

Just two years ago, LCP says Indian buyers accounted for 5% of PCL purchases. 

Over the last year Indian buyers have represented a third of the total spend with LCP, with an average purchase price of £1.77 million (slightly above the market average of £1.6 million).

“As India has become a more challenging place to invest in with high loan interest rates and rising prices in the main urban centres, together with increasing global political and economic uncertainty, Indian buyers with a larger amount of capital to spend have increasingly turned to London as an investment destination of choice,” says Naomi Heaton, chief executive of LCP.

“As sterling has weakened against foreign currencies, representing a 20% discount for USD denominated investors compared with two years ago, we are now seeing Indian buyers becoming an increasingly dominant force in the marketplace.”

She says purchasers from India have now overtaken those from the Middle East, who have fallen to third place.

In stark contrast, the number of buyers from continental Europe purchasing through LCP has fallen dramatically over the last year. 

European buyers have accounted for just 7% of sales over the last 12 months, down from 24% the previous year.

LCP says this drop-off is almost certainly down to uncertainty surrounding Britain’s impending exit from the European Union.

“As the group most impacted by the outcome of the UK’s exit from the European Union, a bounce back amongst these investors will very much depend on the result of on-going negotiations,” says Heaton.