The pound’s weakness attracted buyers from abroad and allowed London’s luxury home market to come back on track.

Luxury-home prices climbed in May for the seventh straight month. In fact the pound’s decline increased the demand from wealthy overseas buyers for properties in neighbourhoods such as Chelsea and Mayfair. As a matter of fact overseas buyers see London as a “good value offer”.

For example the number of Russians seeking property through Knight Frank estate agent has more than doubled in the past two months, and they now account for almost 8 percent of all purchases of more than 2 million pounds according to Bailey whose firm advises and acts for wealthy individuals buying London properties. Properties worth more than 5 million pounds “have come back quite strongly on demand from Russian and Middle East buyers,” said Bailey.

The stock of houses available on the market currently have risen in the last couple of weeks and an increase is expected as second homeowners try to sell out in order to avoid the potential Capital Gain Tax (CGT) increase.

As for the U.K. investors, according to R. Bailey, it seems that they, ” are entering a period of uncertainty” as the government suggests it may lift taxes on capital gains from home sales and given prospects that the economy may slow.

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