Prime London is a magnet for foreign money, particularly areas such as Belgravia, Chelsea and Mayfair.
Prime London is a magnet for foreign money, particularly areas such as Belgravia, Chelsea and Mayfair. According to statistics from the Department for Business, Innovation and Skills, Westminster and Kensington are the most popular areas for investors from outside the UK, with more than 20% of homes in these areas sold to overseas buyers in the last four years.
The reasons are clear. Foreign buyers are not only attracted to London by the city’s favourable tax regime, competitive business environment and political stability, owners of property in prime London saw the value of their investments increase by £166,216 in the 12 months to August 2014, according to the Land Registry figures.
Chinese buyers have especially benefited from exchange rates against a weak pound as they have seen the renminbi increase by 30% against sterling over the last five years. Property in prime London has risen by 25% during the same period, so they’ve achieved a good return on investment. Other beneficiaries of currency exchange fluctuation include buyers from Singapore, Malaysia, Switzerland and the Middle East.
Although the new Capital Gains Tax rules and the possibility of a mansion tax on properties worth more than £2m could deter investment in areas of regeneration, upmarket areas of London will remain a fantastic option for investors from both home and overseas for a long time yet.
Indeed, Investors from places such as Russia, China and southern Europe are keen to purchase luxury homes in the most exclusive residential areas of London, so the competition is intense and demand low; thus pushing prices up even further.
Areas such as Belgravia also attract buyers from the Middle East because they offer guarantee a great return on investment.
Not only that, its international appeal means that Belgravia is the base for many overseas embassies, businesses and charity headquarters. Eaton House Belgravia is also a draw, with foreign buyers able to send their children here knowing they’ll get a top-class education.
In recent years, Middle Eastern governments and sovereign funds have ploughed £4.4bn into the capital since 2006, snapping up development sites and high-value buildings. Half of all buyers of Mayfair property worth over £10m are from the Gulf states.
While central London’s attractions are clear, there are claims that many of the properties snapped up in key places such as Belgravia, Mayfair and Kensington are being left empty, as “ghost homes” as they soar in value.
This is because investors from outside the UK are often unaware of the opportunities the let out their investments, denying them an additional income stream.
Finding property to buy or rent in Belgravia isn’t always easy, which is why we pride ourselves on our customer service; tailored to suit discerning buyers who are looking for desirable options in high end London. If you’d like more information on property to rent and buy in Belgravia, please get in touch.