Upmarket homes in London are being bought by a large number of wealthy Chinese people. Currency exchange rates have meant that those buying from China are receiving significant discounts because of favourable currency exchange. Knight Frank, the property agency has said that Chinese people have a purchasing power that is nearly 25% higher than UK people buying into the domestic market.
Other countries receiving significant benefit because of favourable exchange rates are Singapore and Malaysia with over 22% and 18% higher purchasing power respectively.
A representative from Knight Frank has commented, “This favourable rate is why we are seeing so many people from the Far East buying homes in London. They are not living there, they are just investments.” Between 2008 and this year the cost of prime homes in London has risen by over 5%, these are homes that have a value of over £2 million and last year over half of these were being purchased by foreign investors.
Last year, over £4 billion was spent by foreigners on prime homes in London. One Hyde Park is a luxury developments near Harrods in Knightsbridge and over 80% of those buying an interest in the property were from overseas. This is according to figures released by Candy and Candy, the development company behind One Hyde Park.
Yolande Barnes is from the property consultants, Savills, and she has commented, “Demand from overseas has changed the luxury property market in London and we are seeing billionaires moving into Belgravia and Mayfair, multimillionaires moving into Notting Hill and Chelsea, while millionaires have moved to Wandsworth.” This has meant that in some parts of London it has become very difficult to acquire a luxury home.