Whilst investment interest from other foreign buyers has seemingly dropped after the country’s decision to leave the EU, Hong Kong and China are standing strong, ready to invest when the right opportunity hits.
Peter MacColl of Knight Frank pointed out the increase of Chinese money into the UK property market and said that the money was coming in from different types of investors: state-owned enterprises, corporations and ultra-wealthy individuals.
This rise in investment from China is part of a bigger financial outflow from Asia. Forecasts suggest the national currency to decline in the near future in addition to the Chinese Government possibly introducing stronger controls on capital in the future.
One highly regarded international location for investment was London during the post-referendum fall in the value of the pound, which made it cheaper to buy properties. “Four or five per cent, which is now the net yield in the City on prime buildings, is a very acceptable level of return compared to what they can get elsewhere,” MacColl added.
Chris Brett, head of international capital at CBRE, also mentioned that investment into London property coming from Hong Kong buyers was on par with China.
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“At the moment, there is about £4.5bn [$5.51bn] of live equity targeting London from Hong Kong investors…It’s the most activity we see from any international buyers,” Brett said according to the Financial Times.
Whilst companies in Hong Kong aren’t subject to China’s capital controls, experts say they are also aiming to diversify their portfolio in fears of a destabilisation of China’s market.
