After a prolonged period of sluggish sales, the weak pound is tempting overseas buyers back to Belgravia, Knightsbridge, Mayfair, Kensington and Chelsea, Marylebone and Notting Hill with discounts of around 25%.
This year 2020, we’ll see the first annual price rise of 3% for high-end homeowners in London since 2014.
Property values are then predicted to rise 6% in 2021, 4% in 2022 and 2023, and 2% in 2025 in the capital’s exclusive locations of Belgravia, Knightsbridge, Mayfair, Kensington and Chelsea, Marylebone and Notting Hill.
A hike in stamp duty on multi-million pound homes and Brexit-related uncertainty caused prices to be slashed by a fifth on properties worth more than £2.75 million over the last few years.
These falls will now reverse as luxury dwellings appear to be good value.
Historically, a recovery in the luxury markets has been sparked in prime central London, when the city’s most expensive properties start to look good value on a world stage.
Values have been bottoming out over the past year, resulting in a build-up of new buyer registrations over recent months. This signals that the market is set for a bounce, but this is still being held up by uncertainty.
Overseas buyers to drive the recovery
With a weak pound, the recent price falls equate to a discount of around 25% for overseas property players buying in the US Dollar.
Year-on-year growth in the number of transactions in prime central London is not surprising. There is a continued faith in the medium-to-long term stability of the UK.
London has also matured as a global city and financial centre – it is still seen as a safe haven for the world’s wealthy but won’t attract the same flurry of investment.
It’s too soon to establish what’s going to happen as a consequence of the Brexit. We will continue to monitor the economic situation over the coming months to ensure investors’ interests are fully considered. We’ll be in a position to assess and quickly manage any upcoming changes.
All of our investment decisions are based upon detailed market analysis and a strong understanding of the real economic demand for the product we are creating. As such, we are also aware that a changing market can provide opportunities for our investors and we will continue to actively seek out these opportunities on behalf of the investor.