Chinese Set to Dominate London's Property Market

According to a report published by China’s largest real estate portal Juwai.com, 27% of London’s new homes...

According to a report published by China's largest real estate portal Juwai.com, 27% of London's new homes are being snapped up by Chinese buyers.

Having collated data from CBRE, JLL, and Knight Frank, the firm has calculated that Chinese buyers account for 17% of the total value of all residential property transactions in the capital, 60% for investment and 40% for occupation.

Juwai.com markets 2.4 million listings in 53 countries to around 1.5 million visitors to the site with 82% of its users being located in Mainland China. They have recently struck a deal with Harrods Estates to market their properties directly to a Chinese-speaking audience.

The terms of the agreement provide Harrods Estates with branded marketing, agent profiles and translation options. The agent will also be able to promote its properties via direct marketing, Chinese-language property brochures, advertorials and feature property listings.

Chinese investment has increased by 1500% Since 2010

Juwai.com have also struck similar deals with Idealista.com in Spain, Italy and Portugal; RE/MAX in Australia, New Zealand and Portugal and Luxury Portfolio International in the US and globally. The portal estimates that Chinese investment flowing into the London property market has rocketed by 1500% since 2010, from £54m to a massive £1bn annually.

The portal's report has been billed as 'the first to track the actual real estate search behaviour of Chinese residential property buyers in London' and predicts that Chinese buyers will overtake Singaporeans as the biggest overseas force in the British capital's property market by 2016.

The report also concludes that buyers will increasingly seek out opportunities outside the capital, driven by stronger competition for London properties and increasing familiarity with the British market.

After years or over-production, there has been significantly increased affluence in China with new millionaires being created at a rapid rate.

More millionaires are being created in China than anywhere else

Shirley Humphrey, Director of Harrods Estates said that "there are 643,000 millionaires in China, with 14% more being added to that number each year. Chinese are perhaps the most motivated and numerous wealthy foreign buyers of London real estate."

"Chinese buyers trust the London market and want to be part of this global city for the long term. This agreement will help our agents win more listings and sell more property. This is an investment in the success of our agents and their clients. We want to leave no stone unturned in helping them get the best price for their property."

Co-CEO of Juwai.com, Simon Henry stated that "Chinese buyers already know and trust the Harrods brand name, which will make it easier for Harrods Estates to make itself an estate agency of choice for high net worth Chinese seeking property in London's best neighbourhoods."

"Our experience shows that sellers seek out agents who can give them access to Chinese buyers. Chinese are big investors in London residential property, but it is still early days," he added.

Chinese buyers are increasingly extending their search for property bargains into continental Europe where governments offer residency visas for a qualifying investment in real estate, such as Spain and Portugal.

The main drivers behind the increased interest from Chinese property investors looking to invest overseas are China's housing bubble together with a predicted economic downturn for one of the world's largest nations.

- Monday 09 June 2014

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