Property News > Increasing number of buyers from India enter the prime central London property market

Increasing number of buyers from India enter the prime central London property market

It is well established that the prime central London property market not only attracts interest from all over the UK but also buyers from around the globe. With this, it comes as little surprise that a growing number of buyers from India are entering the prime central capital property market. In fact, Indian buyers are now the second largest group of purchases in the prime central London property market, accounting for as much as 22% of sales.This is a vast increase from two years ago when the number of sales to buyers from India equated to just 5%. The increase is likely to be down to the relaxation around the amount of capital which Indian buyers could remove from the country.In regard to value, Indian buyers represent a third of the total spend and their average purchase price of £1.77million is somewhat higher than the market average of £1.6million.On the other hand, the number of buyers from continental Europe have declined significantly following the UK’s decision to leave the EU with the number dwindling from 24% in 2015 to just 7% over the last year. South East Asian buyers come out on top as the largest buying population, representing 36% of all purchases.The heightened interest from Indian property investors has not only stemmed from private individuals but is also reflected in a shift from institutions and developers from the subcontinent who have been purchasing large tracts of the capital. Despite two years of slower price growth due to tax headwinds and the outcome of the EU referendum, Prime Central London has remained attractive to international buyers who view it as a safe haven asset class, with the rule of law and proper title to property helping to assert this.India has become a more challenging place to invest in dye to high loan interest rates and rising prices in the main urban centres, as well as an increasing sense of political and economic uncertainty on a global scale. Hence, Indian buyers who possess a larger amount of capital to spend are increasingly turning to London as an investment destination of choice.Sterling has weakened against foreign currencies, representing a discount of 20% for US$ denominated investors compared with two years ago, and that is one reason why we are now seeing Indian buyers become an increasingly dominant force in the marketplace, they have overtaken buyers from the Middle East who now sit in third place. However, the increase in Indian buyers has been set against a significantly decreasing number of European investors following the decision to leave the European Union.Representing the second largest nationality just two years ago, buyers from continental Europe have plummeted with their share of the market falling by over two thirds. Because of Brexit, buyers from Europe have been adopting a “wait and see” stance. The group, most impacted by the outcome of the UK’s decision to trigger Article 50 the European Union, a bounce back amongst these investors will depend on the result of on-going negotiations.

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