The London property market that's been a favorite global hotspot for years, is fast losing its sheen as British pound becomes stronger, while emerging economies currencies are turning out to be weaker.

This makes commercial space, office blocks and residential apartments and flats more expensive for emerging markets. The strength of British pound and ongoing currency crisis in the global markets are forcing overseas investors to pause for a while. 

Many property firms realized that demand for property in the London market is slowing down as Asian currencies are weaker making the transactions more expensive for buyers from Singapore, Malaysia, Hong Kong, South Africa, and so on. 

During the first half of 2015, property transactions from buyers from Hong Kong account for only 3.3 percent of total purchases in the prime London homes as against 5.6 percent during previous corresponding period.

The share of investments from Singapore also fell to 1.4 percent from 3.8 percent. Malaysian buyers made up 0.6 percent from 0.9percent. The recent blood bath on global stock markets has further dampened the investors' confidence.

However, market observers feel that this situation is only time being, foreign investors naturally look for safe haven investment during the days of crisis. Considering the present turmoil in the global stock markets, commodities and currency trading, the best option available is only property market. London property market will always attract overseas buyers, opine market analysts.

The property buying after the economic crisis in 2009 resulted in huge profits of GBP870million for those who sold out their holdings during the past two years. The total investment in Central London reached a record level of GBP24.6billion in 2014. 

But, this year, currency fluctuations are eroding the advantage of London property market. For instance a GBP2million worth house in London was selling at GBP2.75million at present considering rising value of British Pound. Regardless of real value of property market, foreign exchange fluctuations are making transactions more costly for overseas buyers. 

The situation for overseas buyers is becoming worse as China devalued its currency Yuan and on the other hand possible hike in interest rate by US Federal Reserve are further dampening the global business confidence. 

The fast losing of interest from Asian buyers is further vindicated by research firms' reports including Knight Frank, which has done market research for Bloomberg, says that interest in London property is waning among Asian investors.

London is now most expensive city in the world and this may need New York-style controls on landlords to curtail steeply increasing rentals.

If one takes a look at several currencies that tumbled this year, it'll give clearer picture on how rising British Pound impacts its property market discouraging overseas buyers.

Brazilian real fell 26.15 percent this year so far, while other currencies that indicate year-to-date (YTD) losses include Colombian eso 24.34 percent, Turkish lira 21.77 percent, Malaysian ringgit 18.45 percent, New Zealand dollar 16.77 percent, Chilean peso 15.22 percent, Russian rouble 15.19 percent, Mexican peso 14.82 percent, South African rand 13.72 percent, Canadian dollar 13.24 percent, Indonesian rupiah 12.76 percent

The drop in emerging economies currencies is slowing down buying activity from overseas investors the places like Battersea Power Station development in London is already witnessing easing foreign demand.
It's estimated that the buying activity of offshore companies for the past 15 years amounting to GBP150billion worth property in England and Wales.

Tax havens-based firms own GBP563million worth assets in Central London alone. Foreigners own majority of homes on Eaton Place.