As UK house prices fall by over 20% and the Pound crashes to record lows against the Euro, UK-based estate agents are reporting rising numbers of international buyers snapping up bargain properties, particularly in London.
“European buyers, especially Italians, are piling in to London’s property market and supporting prices locally,” said Peter Rollings, MD of estate agency Marsh & Parsons. “As far as they’re concerned, there’s never been a better time to buy. While the British economy is faltering, the Euro is getting stronger – and this is the result. This week we’ve seen two Italian couples competing over a £700,000 property in Battersea.”
Ed Mead, director at London agency, Douglas & Gordon, commented: “We have seen 20% more online registrations from overseas buyers compared to last year this time. Nationalities showing the most interest are from Italy, France and the Middle East, who are registering on our website. Currently, 70% of our sales transactions in central London are to foreign buyers.”
Nathalie Hirst, London director at Prime Purchase, a UK property acquisitions company, added: “We have been busy with enquiries not only from existing international clients but also from French, Italian and German investors all wanting to see where and what they might be able to buy.”
Dollar buyers also active
For dollar denominated buyers, prices in London have nearly halved over the last year, paving the way for more US and Middle Eastern investors.
“It’s similar to what happened after Black Wednesday in the early 90’s,” said James Geddes, director of sourcing company Property Vision. “Then, almost overnight, the devaluation of Sterling and the reduction in property prices made London a cheaper place to buy. The number of Middle Eastern buyers registering with Property Vision is fairly constant y-o-y. What is different is that until last year no one was interested in buying in the UK due to the property market peak and the weak US dollar. Recently I have seen a much stronger interest in the UK market due to the reversal of these two factors. In December, 80% of the people we spoke to in the Middle East were interested in UK property, most of them looking to buy in summer this year.”
The falling Pound has also opened up new opportunities for a different level of Russian buyer. Inessa Falina, head of the Russian desk at Hamptons International, said: “There are considerably more Russian overseas property buyers than few months earlier,” she claimed. “Dropping property prices in Europe and the UK and the weak Pound means that property is becoming affordable to wider circle of clients. That’s why there are now more ‘budget’ Russian buyers”.