What a Grexit might mean for the Prime Central London property market

Let’s get one thing clear, the price gains seen in PCL over the last few years have been the most fragile kind – created by a lack of supply. Whilst many have focused on these large rises the fact that volumes have continued to fall have been ignored, but continue to fall they do with little sign of change.

When Greece entered the Euro in 2001 it did so at a rate of 340 drachmas to one Euro. Since then, and accelerating hugely following the 2008 financial crisis, many Greeks have bought property in prime central London. For many they’ve seen the value of their property double or triple.

Experts I’ve spoken to talk of a post Grexit conversion rate of nearer 3000 drachmas for one Euro, over eight times the original rate. So if you have owned a property in PCL and were to decide, post exit, that investments at home can be picked up irresistibly cheap you might, and perhaps many will, decide to cash in.

Indeed if you were one of the early buyers enjoying full uplift in capital value as well as the currency benefit you could fly back to Greece with as much as 80 times what you started out with……>8 times on currency and 10 times the property value.

The only reason I put this out there is that given the lack of PCL supply a run of Greek nationals wanting to take advantage of this absurd arbitrage might have a significant negative influence on prices over the short term.

Medium term the signs are that London will retain its safe haven status and there is a lot more money to be ploughed into the market yet but the events unfolding in Athens should pique the interest of anyone with an interest in Prime Central London property.