China’s interest in UK real estate continues to boom despite ambassador’s warnings to take precaution
When the UK voted to leave the EU, this brought immediate uncertainty surrounding the UK as a safe haven for investment, and many investors held off to see that happened next. However, the Chinese market saw potential and decided ‘now’ is the best time to start building a new financial district in London. Property experts say that China is a key target to the UK’s property market, and with a population of 1.4 billion, we can see why.
High net worth individuals across Asia have been taking advantage of the weak sterling and been snapping up properties across the UK, particularly in London. These properties are bought for one of three main reasons: investment: using London as a secure place to store cash, to guard against the devaluation of the Chinese yuan. For lifestyle or prestige – owning a property in London is a symbol of wealth and achievement. Second home – or most frequently for education purposes in the hopes that their offspring will study in the UK.
China has not directly stated an opinion following the Brexit vote, despite losing around a sixth of its economic output as in important supporter of free trade in the EU.
However, earlier this week, China’s ambassador to Britain, Liu Xiaoming, said in interview with the official China Daily that Beijing respects Britain’s choice but warns that companies should take “precautions” due to the uncertainty. “I believe, when there is a problem, there is always a solution,” he said, adding “Chinese companies in these sectors should take precautions.”
Prime Minister Theresa May will visit China later this year, with talks likely to include closer trade ties for when Britain leaves the European Union. Boris Johnson has expressed the hope of a closer trade ties as Britain eyes its future outside the EU. “I am committed to intensifying our trade relationship, including more market access for UK service exports and more Chinese investment in the UK,” Johnson said in December.
Written by: The Team | On: February 8, 2017