Hong Kong buyers looking to north-west England for property investment

 

Hong Kong buyers and investors continue to view UK property as a safe haven. Many are looking to regional cities, such as Manchester and Liverpool, for value beyond the capital.

Throughout 2020, overseas buyers have been driving housing market activity in the UK, and Hong Kong buyers and investors have been looking beyond London to regional cities in the north-west of England.

In the past six months, 42% of overseas property exhibitions in Hong Kong featured the UK, according to a recent Bloomberg article. This is more than any other country, and the number of exhibitions highlighting the UK has soared since 2019. During 2020, one in three of the UK exhibitions feature property in Manchester.

More value in the north-west

London has long been the traditional destination for Hong Kong buyers and investors. Nowadays, in Hong Kong, there are advertisements in newspapers and on billboards for residential developments across the north-west.

Cheaper house prices are a big draw to purchasing property in this region of the UK. Buyers can get more for their money. Property in Manchester and Liverpool is becoming particularly popular among overseas buyers and investors, especially those based in Hong Kong.

Data from Hometrack’s latest UK House Price Index shows property gets dramatically cheaper outside of the south. With the average property price of London sitting at £476,700, Manchester boasts an average property price much lower at £175,600. Liverpool provides even more value with the average house price at £123,900.

The north-west has a strong housing market, which is continuing to see prices and rental yields rise. Manchester has even been named one of the best places to invest in buy-to-let property during the stamp duty holiday and has been leading the UK’s house price growth in recent years.

With a particularly strong rental market, Liverpool is regularly home to some of the highest yields in the UK for buy-to-let investors. Liverpool and Manchester also have strong economies, in addition to a range of employment opportunities and investment and regeneration projects in the pipeline, making the two cities especially appealing to purchase property in.

Attractive UK market conditions

The UK property market is seen as a safe market to invest in by many overseas buyers and investors. On top of that, favourable currency exchange rates have also been driving overseas investors, especially those in Hong Kong.

The pound remains weak compared to its historical average, while the Hong Kong dollar has been performing particularly strongly. This means the UK offers much better value for money, especially as Hong Kong’s property market is one of the most expensive in the world.

Foreign buyers have been snapping up property in the UK before the additional 2% stamp duty surcharge comes into effect for overseas-based buyers in April. Buyers and investors looking to beat the additional charge need to act quickly.

Many will keep driving activity in the property market in the coming months. However, the stamp duty surcharge is unlikely to deter overseas buyers in the future as the fall in sterling and the UK’s strong property market make up for this additional tax.

New path to citizenship

Since summer 2019, there has been a high level of political stress in Hong Kong. Over the summer this year, China revealed that it could bring in new national security laws for Hong Kong residents. And the latest announcement led the UK to pledge to change its immigration rules for Hong Kong residents.

Prime Minister Boris Johnson promised to provide a path to citizenship for British National Overseas (BNO) residents in Hong Kong. Starting from 31 January, BNO passport-holders will be able to apply to reside in the UK for a period of 30 months, which can be extended, or five years. Many will then be eligible to apply for settlement and citizenship later on. This new visa offers residency rights to nearly 3 million people.

Since the announcement, there has been a surge in Hong Kong residents renewing BNO passports. The UK property market is already seeing a surge of potential buyers. At BuyAssociation, we have seen a spike in enquiries from Hong Kong. Most parties are looking at this as an investment with scope to live.

This surge in interest is expected to continue as more Hong Kong buyers and investors feel the allure of the UK property market, and interest specifically in the north-west is expected to increase further as well.

BuyAssociation has a wide range of property investment opportunities available across the UK, especially in the north-west. Sign up for free to get early access to our best deals, or get in touch for more information.

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