Savills cuts its presence in Europe

Property agent Savills is beating a retreat from troubled European markets, although London's "safe haven" status is still boosting business.

The agent is cutting its presence in several peripheral countries on the continent in order to focus on its main markets of Germany, France, Sweden and Poland as Europe's debt woes intensify.

City lettings remain quiet, but the firm expects that a flood of City properties which have come onto the market during recent months to draw in international capital.

It says demand for luxury homes is "less frenetic" than at the start of this year, but foreign buyers are still being lured in by turmoil elsewhere.

The company added: "It is clear investors continue to see the prime London postcodes as a 'safe harbour' for value in uncertain times."

Savills expects to hit market forecasts for the year, but the City caught the cautious tone of the update, leaving the firm's shares off 6.3p at 294.4p.