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Pound slump leaves elite London neighbourhoods at huge discount for overseas property buyers

·1-min read
Harrods in Knightsbridge, where prices are down nearly 50% in dollar terms  (LightRocket via Getty Images)
Harrods in Knightsbridge, where prices are down nearly 50% in dollar terms (LightRocket via Getty Images)

Homes in London’s most desirable addresses are almost 50 per cent cheaper in dollar terms than they were at their peak in 2014, according to new research today.

The weakness of the pound against the greenback over recent years means that hugely expensive areas such as Knightsbridge, Chelsea and Notting Hill are all seen as “good value” by wealthy foreign investors.

Prices in “super prime” areas reached a high eight years ago before then Chancellor George Osborne slapped far higher stamp duty rates on high value properties.

The threat of a Jeremy Corbyn led Government, and prolonged political turmoil over Brexit also suppressed prices, which are around 13% down on 2014 across Prime Central London as whole.

The analysis by agents Knight Frank shows that buying a £5 million property in Knightsbridge in July 2014 would have cost $8.583 when the pound was worth $1.71.

Since then prices have fallen around 24% while the pound is today down to $1.14. That means that the same property can now be bought for $4.371 million, an effective discount of more than 49%. There are similar discounts in Chelsea, Notting Hill and Bayswater. There are also dicounts of 40% plus in Fulham and Kensington.

According to Knight Frank it menas that US buyers and those fromn countries where the currencies are pegged to the dollar such as Hong Kong and some in the Middle East can “shop around” in London with enormous spending power.

Knight Frank conclude: ”The relative price dfiscount and the reemergence of international travel are tow of the reasons we believe price growth in prime central London will outperform other areas of the UK in the next five years.”