UK most popular market for Asian property buyers
June 17, 2011 - London
The UK is the most preferred location in the world for Asian property buyers - even ahead of their own domestic market, according to a new study from Hamptons International.
The report, commissioned to mark the launch of The Collection, an exhibition of Hamptons' most prestigious properties, which are to be showcased exclusively in Hong Kong in June, surveyed an Asia-based group of people who either own or are actively seeking domestic and overseas residential property.
Almost a quarter (24%) of respondents said they already owned or would buy property in the UK compared with 19 per cent in Hong Kong, four per cent in Malaysia, four per cent in Singapore and three per cent in China. The USA and Australia were other popular investment markets for respondents with 13 per cent and 11 per cent respectively.
When questioned on location, respondents showed a distinct preference for city centre hubs (55%) compared with city peripheries (15%), the countryside (15%) and resorts (15%). Where the UK is concerned, the results suggest that the vast majority of Asian property investment could end up in London, rather than other areas of the UK.
Adam Challis, Head of Research at Hamptons International, commented on the report findings: "Despite currency fluctuations knocking 20 to 25 per cent off peak prices, as the UK economy grows, we would expect some appreciation of the pound sterling against other major currencies. This is likely to impact demand from overseas investors however we may begin to see a shift in buying patterns.
"Outmigration from London to more peripheral locations in the UK can offer a more attractive yield than London and will be priced to reflect the regional "delay" in joining the new economic cycle. Put simply, there may be great deals in these locations once London prices begin to look expensive and yields disappointing."
At a time of global economic difficulty, the report points towards a potential change in Asian property buying habits. When asked about their preference for property type, completed apartments proved most popular amongst respondents (39%) for respondents, with just over a quarter who prefer off-plan apartments (27%), completed houses (15%), land (8%), off-plan houses (6%), property shares and fractional ownership (3% each).
Challis noted: "The current preference amongst Asian buyers for completed stock reflects the desire from this buyer group for simplicity in the deal process and to avoid some of the development risk associated with the market downturn. The current market also offers the ability to take advantage of very strong rental returns."
In stark contrast to the residential investors who seek to "flip" off-plan purchases, 75 per cent of respondents said they are investing for capital growth, with almost two-thirds (62%) committing to an investment term of five years or more.
Ginn Lai, Head of Hamptons Hong Kong, concluded: "Primary buyer motives are based on long-term property investment fundamentals with 75 percent of survey respondents seeking capital growth over income potential. This demand is being fuelled by the weakness of the pound, the stability from the maturity of the UK property market as well as confidence in both achievable yields and capital appreciation."
Hamptons International is capitalizing on the strong interest from Far Eastern investors for UK property with The Collection, an exclusive property exhibition in Hong Kong. The Collection, is a high-profile property event which will display Hamptons' superior London, Country and international properties as well as a small selection of boutique London developments.
The Collection exhibition will take place at the British Consulate from Friday 17 June to Sunday 19 June. For further information about The Collection, please visit www.hamptons.co.uk.
Note to editors:
The survey was conducted through Hamptons Hong Kong and in association with PropGoLuxury.com.
For media enquiries please contact:
Aisling Gray, Senior PR Manager, Hamptons International
020 7758 8422/ 0778 611 firstname.lastname@example.org
About Hamptons International
Hamptons International is one of the premier international residential agents offering an extensive portfolio of UK and international property. Services include sales, lettings, residential developments, property management and mortgages.
With more than 140 years' experience, Hamptons offers unrivalled expertise and service in its market. Hamptons is headquartered in London and currently has an international network of over 85 offices. The company continues to expand both locally and internationally, positioning it as one of the most valuable residential property groups in the world.