The UK’s EU referendum later this month appears to be stalling Chinese property investment.
A recent survey revealed that 51 percent of Chinese property investors are waiting until after the UK referendum on EU membership before purchasing property in Britain.
The survey, conducted by Juwai, included 411 Chinese property professionals.
The findings indicate that this month’s vote on EU membership is the main factor holding back Chinese property investors from making deals in the UK.
Many are waiting to see the outcome of the vote before pouring money into the UK. In the first quarter of 2016, commercial property transactions plunged by 40 percent, according to the Bank of England.
However, a surprising number of respondents believe that a Brexit could actually boost demand, with 46 percent of respondents saying that demand for property would increase if Britain leaves the EU – the figure is only 6 points lower than the 52 percent who believe remaining in the EU would boost UK property interest.
UK property market attracts Chinese investors
The UK is seen as one of the best foreign locations for Chinese investors given the country’s reputation as one of the top locations for corporate investment, in addition to it being a strategic entry point for exports to Europe.1
Following China President Xi Jinping’s visit late last year to the UK the Centre for Economics and Business Research (CEBR) expects new Chinese investments to be worth £126 billion (US$191 billion) by 2025.
Buying property in Britain has also become more appealing to the Chinese after the UK government agreed to extend the maximum length of a visa to 2 years and increase the number of processing centres in China from 10 to 50.
London is seen as the top city in the UK for Chinese investors. However, other areas are also attracting beginning to attract interest, such as Manchester, Liverpool, Brighton, and Birmingham.
Reference:
1 ‘5 ways the UK just got more enticing for Chinese buyers’ – Juwai, 15 December 2015