Foreign investors snap up majority of homes in London’s most exclusive areas amid price slump

Foreign investors bought more than half of all properties for sale in London’s most exclusive areas in the second half of last year, according to new research.

The number of overseas investors snapping up homes in high-end parts of central London like Belgravia and Kensington have hit a five-year high, with a jump in Middle East investors, research by estate agents Hamptons showed.

It comes as the asking prices of homes in such spots are selling at the biggest discounts in more than a decade, the Financial Times reported.

Research by LonRes shows prices per square foot in such areas have dropped by five per cent since 2014, when they peaked, while the most expensive locations have seen prices drop 11 per cent.

Meanwhile across the rest of the capital, about 30 per cent of homes sold were to foreign buyers.

It comes as Sadiq Khan promised earlier this week housebuilders are to give Londoners “first dibs” on new-build properties.

House prices tumble again as buyers face a squeeze

However this will only apply to lower-priced properties, with people who live or work in the capital getting a month’s “head start” to buy homes up to £350,000 before anybody else is able to purchase them.

Fionnuala Earley, a director at Hamptons, told the FT that although prime properties in central London have taken “a bit of a bash”, they will always be sought after.

She added that the number of foreign buyers investing in the capital’s property market slumped after the Brexit referendum but has since recovered.

In the second half of 2017, around a sixth of the prime central homes sold were bought by Middle Eastern investors, up from 5 per cent on the first six months of the year. 

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