Chinese investors set to purchase $13bn worth of UK property

Chinese investors set to purchase $13bn worth of UK property

Investment levels set to soar in the next five years as Far East investors value the stability and the strong returns UK real estate provides.

Summary:

  • $13.2 billion worth of investment in UK property by Chinese investors has been forecast by 2020
  • British real estate offers high returns and stability in the face of volatility from global equities markets, particularly those in the Far East
  • Chancellor George Osborne recently visited China showcasing the investment opportunity of the UK’s Northern Powerhouse

As China’s President Xi Jinping visits the country on a four-day state visit, what’s making real estate in the UK currently one of the hottest assets among Chinese investors?

$13.2 billion has been tipped to be spent on property in Britain from people in China, a new report from leading Asian real estate platform Juwai.com forecasts.

In 2014 an estimated $3.12 billion was spent on UK property by investors from the Chinese mainland, with Juwai.com claiming that Britain is the country’s fourth most popular international location for investment.

UK property is an established asset for international investors, with its track record of stability and for growing returns. Its appeal has been particularly pronounced in recent months as equities markets around the world flounder, particularly China’s Shanghai Composite index which fell by 8.5% in just one day on Black Monday.

Around 72% of all enquiries in London’s property market are made by Chinese investors, underlining the regard that bricks and mortar in Britain’s capital is held in by investors in the Far East. Huge growth in the last 20 years has seen investors enjoy significant gains, but now the market in London is starting to hit an affordability ceiling as it reaches the end of its growth cycle, meaning that many investors now must turn to other cities for the best acquisition.

In September UK Chancellor George Osborne visited China in an attempt to highlight the investment potential of the Northern Powerhouse. Cities such as Manchester are set to benefit from billions of pounds worth of sustained economic investment over the next few years, with the prospect of this growth impacting on the upward trajectory of local property sectors.

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