Currency gains boost London housing market
OVERSEAS investors continue to pile into London real estate, thanks to increasingly favourable exchange rates and soaring rental values, according to research seen by City A.M.
Foreigners currently buy 72 per cent of all central London homes on the market, said a report by Hamptons International, up from 60 per cent at the peak of the market in 2008.
The relative strength of the pound since the start of the crisis has meant 35 per cent discounts for Japanese buyers, and over 20 per cent for those with currencies pegged to the dollar, on top of existing exchange rate discounts and property valuation changes.
“Lots of people are surprised that property values have returned to the peak seen before the crisis. This research helps to explain why so many foreign buyers are buying in London: there is a still great currency opportunity,” Hamptons head of research Adam Challis said.
Customers from the Eurozone were enjoying a 4.8 per cent discount during the summer, said Challis, but currency movement since the Greek and Irish bailouts has erased any gains.
Rents for prime London homes have also risen 28 per cent this year, said research by Primelocation.com, giving owners a better return on investments.