An independent estate agency says a No Deal Brexit will prompt a “feeding frenzy” of foreign buyers who are already “piling in” to bulk-buy in London.
James Pendleton says property values in the capital have been falling for well over a year but demand from foreign investors buying in bulk is stronger than ever.
Founder director Lee Pendleton says foreign buyers are continuing to benefit from currency devaluations since the EU Referendum in July 2016 and are also taking advantage of a softening in the attitude of developers to discounting.
He adds that a no-deal Brexit would only serve to spark a more intense “feeding frenzy” as these large players “pile in” to take further advantage of further weakness in the value of the pound.
As Pendleton was making the claims the actions of Boris Johnson in suspending Parliament next month sent the Pound on yet another downward spiral: £1 is now worth €1.10 and $1.22.
The agency is currently handling the purchase of 75 units in south-west London as part of a single transaction worth in excess of £40m.
Pendleton says that combined with a currency dividend, if these investors can get a 25 per centdiscount from a developer, they can be looking at the equivalent of a 40 per cent discount on value overall.
However, Pendleton warns there is still very little demand for anything over £1,500 per sq ft — with bulk buyers favouring anything under £800 per sq ft.
James Pendleton calculates it is the first independent agent to launch an investment advisory service for institutional and bulk investors.
Lee Pendleton adds: “Anyone who thinks foreign investors and funds have beat a retreat from London are mistaken. The only people who have backed away are UK investors. Developers can see the market has softened and they are willing to give bigger discounts than at any point in the past 10 years.
“As a result, there are a lot of big overseas funds and investors looking for freehold buildings that have a mix of commercial and residential in them.
“They are hoovering up dozens of homes at a time and their behaviour clearly indicates to us that the bottom of the London market is at hand. The prospect of a no-deal Brexit is a concern to some but, in reality, it would only spark a feeding frenzy among these large players who will pile in as the pound falls.
“This is the perfect time to launch our new department, which will cater to patient investors who believe London property at current prices will pay huge dividends over the long term and are so confident in that belief that they are committing vast sums of money. “