Hong Kong investors have seized a growing share of newly developed homes in London over the past 12 months, strengthening their position as the largest group of foreign buyers in the market.
According to property firm Knight Frank, 24 percent of off-plan buyers in the 11 boroughs of inner London came from Hong Kong over the past year, a third higher than in June 2010, when they accounted for 16 percent of the market.
The increase was partly attributed to mainland investors acquiring London property during exhibitions in Hong Kong.
“As wealth in some regions of mainland China increases, more money is being filtered through Hong Kong where the sales process is easier,” said Seb Warner, Asia Regional Director at Knight Frank.
Hong Kong-based buyers are Knight Frank’s largest group of international purchasers in London’s new developed market.
Property agencies such as CB Richard Ellis (CBRE) and Hamptons International had similar reports.
Darien Bradshaw, Executive Director at CBRE, has estimated that 2,100 London flats were sold off-plan at exhibitions in Asia in 2010, with 60 percent — approximately 1,260 homes — sold in Hong Kong.
At some developments, Hong Kong buyers have acquired most of the apartments available for sale. According to Hamptons International, 15 of the purchasers at 18 Alie St, on the eastern edge of the City of London, were from Hong Kong, while the rest came from Singapore. The apartments were offered from £315,000.
The level of demand today is greater than in the 1990s, when the first huge wave of Hong Kong real estate investment hit London.
Mr. Warner said, “This is a bigger trend than the mid-90s. The future of this trend depends heavily on the exchange rate and the Hong Kong economy, but I cannot foresee it reversing in the short term.”
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