French buyers have jumped to the top of prime central London’s international buyer rankings. According to global property consultancy Knight Frank, property purchasers from France made up the largest group of buyers in prime central London during the first nine months of 2020.
They accounted for 11% of all transactions involving overseas buyers, says the firm.
Analysis of Knight Frank’s purchaser data highlights that Chinese buyers have dominated in recent years and accounted for 15% of overseas transactions in PCL between January and September 2019, while over the same period, French buyers represented just 2%.
UK buyers represent a larger proportion of overall sales in PCL in 2020, which are down by around a third in the first nine months of this year. They accounted for 59% of deals over the period compared to 47% last year.
While the lifting of international travel restrictions is the primary concern for many international investors, others are capitalising on the travel hiatus and looking beyond the political uncertainty of the next few months.
“Despite the background noise of Brexit, there is smart money in Europe targeting London,” said Tom Bill, head of UK residential research at Knight Frank. “The combination of a weak pound, a looming stamp duty hike and less competition from buyers who need to catch a long-haul flight has created a buying opportunity.”
As Brexit negotiations continue, so has the downwards pressure on the pound.
Bill continues: “Between the period before the EU referendum and the middle of last week, Euro-denominated buyers benefitted from an effective discount (currency plus house price movement) of 30% in PCL. That is a big number, irrespective of the latest rhetoric surrounding Brexit.
“For buyers denominated in US dollars or dollar-pegged currencies, the equivalent discount is 27%.”
When factoring in how much can be saved ahead of a stamp duty hike for overseas buyers next April, it is clear to see why those international buyers who are able to get to London more easily have decided now is the time to act.