More foreign buyers in London if UK quits EU, says estate agency

Prices are wobbling in the London housing market, with the referendum and ongoing currency fluctuations being two of the major causes.

That is the view of one of the capital’s most prominent agencies, Stirling Ackroyd, which says that whilst a generally weak Pound has encouraged some foreign buyers to snap up ‘cheap’ property, the market as a while is cooling rapidly.

The depreciation in Sterling in June means the average price of a house in London equates to just €596,900 says the agency – this compares to a record high of €630,100 in November 2015. This is the equivalent of a fall of about £26,000.

This saving amounts to a 5.3 per cent discount within London’s residential market.

“European buyers are snapping up bargains across London. A declining exchange rate has meant London is becoming a more affordable global property hotspot – particularly for those paying in Euros” says Andrew Bridges, managing director of Stirling Ackroyd.

“If Britain votes to leave the EU, Sterling is set to fall further so, ironically, London would become even more affordable – and therefore more attractive – to overseas buyers paying in Euros.  While Eurozone buyers are propping up the temporarily soft market as prices stutter, Brexit might make Europeans much more significant players in London.”

However, with many other sellers and buyers sitting on their hands until Friday morning’s result, Stirling Ackroyd claims high end areas are seeing price falls. 

“House prices may be cooling slightly in the face of geopolitical uncertainty but this is offering bullish buyers opportunities. The luxury areas of London’s property market are feeling the acutest drops in house prices but these areas typically have a higher proportion of European buyers – meaning exchange rate discounts on property purchases are compensating for any further slowdown” says Bridges.