London property market continues to be one of the most favoured destinations for wealthy Indians.
The city has seen an 11% year-on-year (Y-o-Y) rise in the number of Indian homebuyers in prime London markets in FY19 (2018-19), according to a report by property consultant Knight Frank. The rich Indians are buying properties in London at discounted prices.
"An effective discount of about 20 per cent, taking into account the currency and price movements in prime central London in the period between the EU referendum and October 2019, has benefitted Indian buyers," Knight Frank said in its report 'London Super-Prime Sales Market Insight-Winter 2019'.
"London property market continues to remain one of the preferred destinations for wealthy Indians," it added.
Belgravia, Hyde Park, Mayfair, Marylebone and St John's Wood are the most favoured locations of interest for Indian homebuyers in London.
The consultant further highlighted that the profile of wealthy Indian buyers are becoming younger.
In Knight Frank Wealth Report 2019, released earlier this year, the consultant had said 21 per cent of Indian ultra high networth individuals (UHNWIs) showed interest in purchasing homes outside of their domicile country, out of which 79 per cent wanted to invest in the United Kingdom (UK).
"London has always been a hotspot for Indian investors due to its economic and political importance. Despite the recent political and economic developments, the long-term economic fundamentals for the market has remained strong and is, therefore, continuing to generate interest amongst Indians looking to purchasing properties outside the country," said Shishir Baijal, chairman and managing director, Knight Frank India.
When compared to investments in the Indian markets, he said the yields for both capital and rental are higher.
"As the domestic economy hits a slow block, we can expect Indians to continue the momentum of investments in a mature market such as London that offers higher returns and relatively shorter hold period," Baijal said.
Alasdair Pritchard, Knight Frank Private Office and Knight Frank's ambassador to India, said, "London will always remain an interesting market for wealthy Indian buyers. Many have an affinity to it -- enjoying the history, the culture and lifestyle on offer. A large number also send their children to the UK for education, investing in property at the same time."
With Indian capital flow restrictions in place, many are limited to spending half of what their appetite would have been previously, he added.
"Despite this, in the 12 months to June 2019, we have seen an increase of 11 per cent in the number of Indian buyers purchasing property in the prime London market compared to the previous 12 months," Pritchard said.
In terms of super-prime properties, or homes priced above 10 million pounds, global buyers spent a total of 2.06 billion pound in London in the year to May 2019, marginally higher than 2.05 billion pound in the previous 12 months.
While this underlines the resilience of demand against an uncertain political backdrop, overall transaction volumes fell 13 per cent to 104 from 120, the report said.
(With PTI inputs.)