Chinese Leading Buyers of London New Homes
Buyers from Hong Kong and China were the largest group of buyers of new homes in prime London in the last year, accounting for 27 percent of the market by volume, according to a recent report from Savills.
Chinese buyers dominate the market for new apartments, favoring high-rise, contemporary buildings in waterside locations, the consultancy says.
"There were initially two distinct groups investing in London, the established Hong Kong ultra-high net worths, and the new wealthy mainland Chinese," Savills director of residential research Yolande Barnes says in the report. "As Chinese buying in London grows, this is broadening to include a whole range of Chinese mainlanders and more Hong Kong residents."
The majority of purchasers are from Hong Kong, with mainland Chinese buyers restricted on overseas investments, Savills reports. Many purchases of prime new homes are for Chinese families and their children attending schools in the U.K.
Chinese buyers have not been as active in the existing home market. When existing homes sales are included in the data, the largest group of foreigners buying in London is from Western Europe, representing 13.6 percent of the overall residential market. While housing markets in the U.S.
recover from the financial crisis, foreign buyers from North America make up only 3.3 percent of all prime London sales. Latin America is the only region not significantly represented in London's prime markets with just 0.1 percent of buyers in the overall market. London's prime home prices
were 60 percent higher than a post-crisis low in 2009, a Knight Frank report showed last month.
However, the Savills report refutes the latest news reports claiming London's housing market is overrun by the world's super rich, who are simply investing in property that they rarely use.
"Far from being 'buy to leave' investors, most overseas buyers in London live and work in the U.K.," Ms. Barnes said in the report.