Russian oligarchs, Middle Eastern oil barons and billionaire Chinese entrepreneurs have been on a spending spree on London real estate over the past three decades, snapping up trophy homes and high-end commercial property. The war in Ukraine is making it hard for even unsanctioned Russians to sell exclusive residential property in Britain, adding to a shortage of supply that has helped drive up house prices in prime locations. There have been several transactions that have not gone through, two more than 40 million pounds ($49 million).
Widespread shortage of available properties has pushed up prime London prices by 4.7% since the invasion. The number of prime central London residential sales was down 30% between March and May compared with last year, though still up on pre-pandemic levels. Britain in February scrapped its so-called “golden visas” for wealthy investors and last month announced plans for a new economic crime bill, intended in part to identify the owners of property in Britain and combat illicit finance, although critics say loopholes remain. Unprecedented Western sanctions on Moscow, the withdrawal from Russia of scores of Western companies and pressure on London’s advisory companies to cut links with Russian clients have driven some Russian buyers to friendlier property hotspots such as Dubai or Istanbul.