Chinese interest in UK residential property has reached record levels, according to a new report.
The findings of Juwai.com’s Q4 UK report showed that Chinese enquires about places to live in the country had more than tripled to a new high between February and August this year.
Interest in Manchester property from potential Chinese investors in August 2018 was up by 200% on the same month a year earlier. This tallies with a recent study which found that direct flights from Beijing to Manchester had to led to increased numbers of visitors to the north-west from China, and a big rise in Chinese spending in the region since the route was established in 2016.
The report from Juwai, China’s largest overseas property website, also showed impressive figures for other regional cities in the UK. Enquiries about Liverpool were 162.5% up on August 2017, while interest in Birmingham was nine times higher than for the same period a year ago. Interest from China in London over the same period had risen by 65%.
“Most Chinese still have positive long-term expectations for the UK economy and property markets despite Brexit,” said Carrie Law, CEO and Director of Juwai.com. “Most see the UK as a long-term reliable market offering an excellent lifestyle and enviable opportunities for their children to study, work, and live. Are they being too optimistic? Only time will tell.”
Rule change making a difference
The figures suggest that the Chinese government’s decision to relax its rules over allowing its citizens to invest in real estate in the UK earlier in 2018 has made a difference.
Those who already invest in the UK now have the added option of trading and refinancing their existing stock while reinvesting elsewhere, without first requiring governmental permission, while also encouraging greater diversification into the asset classes covered by the new exemption, including logistics, infrastructure and business parks.
“Buyers from mainland China in particular are much more willing to buy flats that aren’t yet built than are locals in the UK,” added Juwai’s chief executive. “That gives developers the pre-sales they need to start construction.
“Without having pre-sold a certain percentage of the building, they cannot get financing to start paying builders to lay bricks. That’s one reason research in Australia shows that foreign buyers enable the construction of four residences for every single one that they purchase.”