London's luxury home market booming post Brexit vote

House viewings in London’s wealthiest areas have risen 49.1% and the number of homes under offer rose 19% in the eight weeks after the Brexit vote compared to the previous year, the Financial Times reported.

Price falls in areas such as Chelsea and Knightsbridge and the decline in sterling have attracted buyers back into the market with over half coming from overseas, according to estate agents Knight Frank.

“For buyers in overseas currencies, obviously there is a strong currency play, given the drop in sterling since the start of the year. That has translated into more activity and certainly more sales,” head of London residential research Tom Bill said.

An estate agent in London, Charles Dowell said he had sealed deals for two £20m homes and one at £12m since the referendum result.

“My clients see a short-term buying opportunity for London property and they think that the UK in the medium to long term is in pretty good shape,” McDowell said.

The prices in central London areas have reached their steepest annual rate of decline in seven years. House prices in Chelsea and Knightsbridge were down 8.9% and 6.8% respectively.

Despite the spike in demand there was still a relative scarcity of homes available.

“A lot of people are hanging on to try to get a better price in 18 months or two years’ time. So there’s not a lot of stock on the market and it’s keeping prices relatively high,” said McDowell.

Luxury home prices have also been hit by a series of stamp duty rises. In 2014 the Treasury increased the tax on homes costing over £937,500 and this year it introduced a surcharge of 3% of the purchase price on second and additional homes.

Bill said it was not yet clear whether higher volumes would translate to price recovery with price increases still occurring in areas such as Islington where they rose 3.6% during the past year.