On Monday the pound reached a fourteen-month low trading against the US dollar at 1.2149. As UK bond yields have risen to their highest level in 16 years, there may be a silver lining to this news. While this news is a disappointment to many, it presents an opportunity for international buyers to capitalise in the prime central London property market. The market, which has seen a vast increase in international buyers over the past two decades, is once again providing an excellent opportunity for those seeking to invest foreign currency in London.
London has long been known as one of the most internationally diverse cities on Earth with 40% of Londoners being born outside of the UK. The statistics speak for themselves, in 2023, 45% of homes purchased in prime central London were bought by international buyers. In 2024, American and Middle Eastern buyers accounted for almost 50% of super-prime sales across London’s most prestigious addresses. This statistic doesn’t include buyers from Europe or Africa who also invested heavily in London’s super prime real estate. International buyers have made up a considerable percentage of the super prime real estate market for some time and for those looking to invest for the first time, or to expand their property portfolios, now provides an excellent opportunity to do so.
Penthouse for sale in Millbank, Westminster £19.95m - United Kingdom Sotheby’s International Realty
With the incoming inauguration of President-Elect Donald Trump and devastating wildfires currently plaguing some of the wealthiest enclaves of the West Coast of America there is no doubt change is afoot. Americans have long been interested in purchasing London property which is reflected in the share of US buyers purchasing London homes which almost doubled in the first six months of 2024, compared to the latter halft of 2023. While there are no concrete statistics on just how many Americans plan on leaving the United States there is definitive proof that a move overseas is something many Americans are considering. Google Trends revealed in early November, on the dawn of the US election, those exploring “move abroad” reached a 12-month peak. Whether Americans are looking to relocate permanently or perhaps purchase a pied-de-terre, there is no better time for Americans to invest than now given the weakened state of the pound.
Since September 2024 the pound has fallen almost 10% from around 1.34 to 1.22 which is a significant difference when looking to purchase property in the millions. An international buyer seeking to purchase a property in London in US dollars today would effectively be saving 10% of what they would have paid in September 2024. Say the buyer was hoping to buy a property for £3 million they would be spending £300,000 less than they would have three months ago.
The weakened pound doesn’t only benefit those purchasing property with US dollars, but also with Euros: if an investor looking to purchase in Euros spent 5million euros today, they would save €97,000 compared to what they would be paying a mere one month ago. The saving of 1.64% on Euro transactions is a significant reduction when dealing with large monetary sums. Therefore, prime central London real estate is effectively experiencing a significant sale to most net sellers of foreign currency.
While there are no solid predictions for when the pound will bounce back, one thing is for certain, there has never been a better time for international buyers to invest their money into the prime central London property. The weakened state of the pound presents an opportunity not to be missed.
