Central London homes given overseas boost

 
Kasmira Jefford
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OVERSEAS investors choosing London as a safe haven destination accounted for 75 per cent of the increase in prime central London residential prices relative to the rest of the UK, a new report shows.

Foreign investors have poured into boroughs such as Knightsbridge and Chelsea since the mid-1990s and fears over the demise of the euro since the 2008 crash has exacerbated London’s status as a safe haven.

New research commissioned by property firm Development Securities reveals safe-haven flows have boosted the prices of prime London homes by 30 per cent since 1995 relative to the rest of the UK and are now above levels reached at the height of the bull cycle in 2007.

Foreign money accounted for 60 per cent of acquisitions by value between 2007 and 2011, with more than half of the residents of Westminster and Kensington & Chelsea – the two boroughs that contain the bulk of the prime market – now from overseas.

Michael Marx, chief executive of Development Securities, said: “The prime central London residential market has seemingly defied the laws of gravity in the past few years. The ‘safe-haven’ effect has clearly played its role in attracting foreign money into London’s most desirable post codes.”