The Upside of a Global Downturn? Juicy Real Estate Deals
High-end home prices are being slashed by as much as 30 percent.
To lure house hunters, sellers of high-end homes are slashing prices by as much as 30 percent. Many metro areas are succumbing to downward pressure from the U.S.-China trade war, uncertainty in Europe, rising interest rates, or a combination of all three. Of course, all real estate is local, so some discounts are better than others. Here’s where policymakers, central bankers, and developers are creating an environment for juicy deals today—or even better bargains tomorrow.
By the numbers: Home values in the city’s prime neighborhoods are 19 percent below their 2014 peak, according to broker Savills Plc.
What happened? Few sellers anywhere have faced such a poisonous economic cocktail as those in the Chelsea, Kensington, and Westminster districts, where tax changes on luxury properties have hit hard. Add in Brexit and an anti-money-laundering crackdown on cash from countries such as Russia and China, and demand for high-end homes has dried up. The discounts were enough to lure hedge fund billionaire Ken Griffin to spend £95 million ($122 million) on a mansion near Buckingham Palace in January, a cut of almost 35 percent from the original price.
Act now! A five-bedroom home in the city’s most expensive apartment block, One Hyde Park, has been languishing on the market for two years. The asking price is £50 million, down from £55 million.