House prices have fallen by about 15 per cent for the average domestic buyer since the market reached its peak 18 months ago, according to Savills, the property consultancy. But overseas buyers are capitalising on sterling's weakness to achieve discounts of 35-50 per cent.

Buyers using euros have seen an effective price fall of 35 per cent. Those using US, Singaporean and Taiwanese dollars have even greater buying power, according to Savills, while Japanese yen investors can buy a UK property at half the price of a year ago.

Savills' estate agents report a sharp increase in the number of overseas buyers and inquiries. 8 Jan's decision by the monetary policy committee to cut rates by 50 basis points is expected to boost demand further. The last interest rate cut generated an almost immediate surge in international inquiries, according to the consultancy.