House prices: London property sales are up 40% despite Brexit
07-12-2016
But prices fell in June and sales surge is not expected to last
Carl Court/Getty Images
House prices: London property sales are up 40% despite Brexit
Prime real estate sales in London increased in the week after the EU referendum, as the falling pound attracted investors hoping to take advantage of the financial uncertainty brought on by the vote.
Sales increased 38 per cent in the week after the referendum compared to the previous week, according to the property consultant Knight Frank.
Despite pessimism about the effects Brexit would have on the property market, month-on-month sales were up by 29 per cent, the real estate brokerage said.
"We saw a definite uptick," says Liam Bailey, global head of research for Knight Frank. "And we certainly are seeing a scattering of sales because of the currency movement."
London has attracted investment from wealthy property barons from the Middle East, Russia and Asia, the Daily Express says, "and as the pound tumbled many looked to sweep up more penthouses and townhouses in the city, showing they are keen to continue investment in the country."
According to the paper, investors who use the dollar "had a particular advantage when the British pound dropped 15 per cent against the American currency."
However, the surge in sales is not expected to last as the FTSE 100 bounces back and the pound begins to recover with prices in the capital falling slightly.
Average prices in many of London's most exclusive areas fell by 0.2 per cent in June compared to May.
"Our views is that it's early days and everyone is waiting to see what the terms will be between The UK and Europe," Bailey says. "That will take time. So we expect the property markets will slow through July and August."