Weak pound makes market attractive to investors in Dubai
Buyers eye London properties
Qatar's spending spree in London has sparked renewed interest among Dubai residents to consider buying homes in the UK capital as people look to take advantage of a weak pound and a pick up in the property market. Last week, Barwa Real Estate, which is 45 per cent owned by Qatari Diar, bought Park House in the city for £250 million (Dh1.36 billion), adding to a portfolio that includes stakes in the Shard tower and Chelsea Barracks.
Yesterday, a steady stream of potential buyers visited a London property exhibition in Dubai organised by Kanoo Property, a Dubai-based broker. "We haven't done anything like this in Dubai before," said Michael Topham, the general manager of Kanoo Property. "We think it's a good time. The property prices in London have started to climb. There isn't a huge amount of stock and there are not a lot of new developments."
With sterling down more than 25 per cent from its peak against the dollar, to which the dirham is pegged, currency weakness is also a major factor. "With the position of the dollar against the pound, it means that it's also quite a good time to buy," said Mr Topham. The most expensive property being sold at the exhibition was a penthouse in a new building near Victoria Station priced at just over £1 million and there were studio apartments in a north-west London off-plan starting from £189,500.
According to the Knight Frank Prime Central London Residential Index, property prices were up 1.4 per cent in central London last month on the previous month to hit 4,487.7, up 23 per cent on the low point of 3,652.2 in March last year and down 6.4 per cent on the March 2008 peak. "The weak pound is having the effect of pulling in demand from overseas buyers who view London as offering good value, with prices still 34 per cent lower in dollar terms from the 2008 peak," said Liam Bailey, the head of residential research at Knight Frank.
Pradeep Jangid, a 23-year-old Dubai-based architect originally from India, was considering buying a flat in an off-plan development in Clapham advertised at the exhibition, with prices starting from about £300,000. "It's probably a good time if you've got the money," said Mr Jangid. "During the recession the prices have gone down, although it's still expensive. "I'm trying to look for projects under construction because I'll probably get a better deal."
Mr Topham said five deals had been completed at the exhibition and he was expecting several more to be sealed over the coming weeks with interested buyers who had attended the event. "We're quite pleased with the way it has gone," he said. In recent months, the company said it had been focusing on tapping into demand in Asia for its properties in London but would now also consider conducting a roadshow of the Gulf region after the summer.