Following a significant increase seen over the last six years, average property prices in Prime London Central (PLC) are now 34 percent higher than their pre-credit crunch levels, according to HM Land Registry data analysed by London Central Portfolio (LCP).
But LCP noted that London property actually appears ‘cheap’ for overseas investors, who are said to account for nearly 60 percent of the overall buying population.
Southeast Asian investors, including those from Hong Kong and Singapore, comprise the largest proportion of buyers at 40 percent, and with the weakening sterling, they also profited the most. Currency-adjusted property prices for Singapore and Hong Kong buyers are 12 percent and 10 percent lower than their 2007 high.
In comparison, Malaysia saw a 10 percent price drop in the last six years while Thailand saw three percent growth during the same period.
Given London’s safe haven status, the influx of foreign buyers into PLC was also stimulated by the fall in sterling, coupled with cheap debt.
“Whilst it may sound absurd, property prices in PLC look particularly good value for international investors as prices in their home markets rise substantially and sterling remains so weak. For Singaporean investors, for example, the average PLC property cost S$2,003,276 in October 2007 but costs S$1,718,044 today,” said Naomi Heaton, CEO of LCP.
“So, not only does PLC residential provide excellent prospects of capital growth, given that strong demand consistently outstrips supply, it looks excellent value for money for overseas buyers,” she added.
Nikki De Guzman, Junior Reporter at PropertyGuru, wrote this story. To contact her about this or other stories email nikki@propertyguru.com.sg
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