The devaluation of sterling that accompanied the Brexit vote could see a glut of prime London investment, but will it be enough to increase prices?
During the first day of trading, the pound fell by 10.1% against the dollar, and was 9.4% down by Wednesday’s close.
Chris Stocker, acquisitions director at prime central developer Sons & Co, said there had been “a spate of phone calls from interested European buyers while the currency was at its lowest”, and from Chinese investors.
London Central Portfolio, a prime residential investment agency, said it had received many enquiries and announced extra fundraising.
“The depreciation in sterling has created an opportunity to target residential property,” said Cluttons head of research, Faisal Durrani.
Bruce Ritchie, chief executive of Residential Land, does not expect to see larger price falls than were caused by the stamp duty hike, with the market backed by safe haven buyers and Europeans looking to enter before the Brexit negotiations end. “Is now a good time to get in? Seasoned investors might be positive about it; new investors might be more shy,” he said.
Many are questioning whether the market will be influenced by short-term price falls or longer term trends. Estimates combining currency and last year’s declining values suggest potential discounts of 25%.
Follow our Brexit reaction blog here >>
• To send feedback, e-mail alex.peace@estategzette.com or tweet @egalexpeace or @estatesgazette
