LONDON CALLING: Pound fall makes capital more affordable to long-term foreign investors
WITH property prices in Britain predicted to plummet post Brexit, foreign investors, especially in Asia, are already poised for a buying spree.
Property sales are also expected to be hit in the aftermath of last Thursday’s (23) vote to leave the European Union (EU), with reports of buyers pulling out due to market uncertainty.
But while some foreign investors are cautious, others want to snap up bar- gains while the exchange rate is low.
“Several of my opportunistic investors have said we really ought to think about this seriously, and to think whether we should take advantage of this new window in the market,” said Nicholas Brooke, chairman of professional property services for the Royal Institution of Chartered Surveyors.
“Anyone who’s not dealing in sterling would see an opportunity.”
It is an ironic twist to the shock referendum result – many who voted to leave the EU saw it as a deterrent to outsiders looking to take advantage of economic opportunities in Britain.
London-based international property agent Knight Frank said foreign investors would be wary as they assessed the full impact of the Brexit fallout, but the drop in the pound would mean their buying power would “increase significantly”.
Interest would be especially strong from China, Hong Kong and Singapore where investors have a long history of buying up property in Britain, especially London, the firm’s Asia-Pacific specialist Nicholas Holt said.
London house prices are among the most expensive in the world and have been on the rise over the past six years. But property consultancy Jones Lang LaSalle (JLL) said capital-value adjustment could be down up to 10 per cent in the next two years. However, this won’t put off more buyers from India.