Asians invest over £760m in new homes in London

Over the past year, investors in Asia have invested a total of £761m (more than $1bn), in newly built apartments in central London, up from around £250m a year, according to property firm Knight Frank.

Asian property investors are attracted to a combination of positive factors, including a historically weak British pound, sluggish property prices, which are down by over 10% from a record high in 2007, and low interest rates.

A lot of the money in Asia is coming from wealthy ex-British colonies such as Hong Kong, Singapore and Malaysia, where most investors are familiar with London.

Since late 2009, a growing number of new home developers in the UK, such as Barratt, Berkeley Group and Ballymore Group, have increased their marketing spend in Asia in an attempt to attract more Asian investors.

The proportion of Asian investors buying new homes in central London has increased to 50%, up from around 30% in the previous year, Knight Frank said.

Despite some concerns that Britain could be headed for a double-dip recession, most Asian investors still deem homes in London as a good place to invest, especially as property prices in Asia have been escalating at a rapid pace, creating bubble fears.

"The last 12 months have been the strongest in selling London property to Asia in 15 years," said Darien Bradshaw, regional director for international properties at Colliers, which has been marketing flats in Asia via exhibitions.

Reuters report that Colliers have sold around £200m worth of British apartments in Asia so far this year, already outpacing the £150m for the whole of 2009, to buyers in Hong Kong, Singapore, Malaysia and China.

Colliers, which helps market projects for new home developers, has held 26 exhibitions throughout Asia this year marketing mainly London apartments, and has plans for another 20.

New home builders say Asian buyers are used to purchasing off-plan homes, meaning that they are willing to place orders before the construction of the apartments are complete.