More Chinese Buyers Show Interest in UK Property Following Brexit Vote – Reuters

By Esha Vaish

Interest from Chinese buyers in acquiring UK property has seen a notable increase following Britain’s decision to exit the European Union. According to a recent statement from a real estate platform, the depreciation of the pound has opened up attractive purchasing opportunities for investors looking for discounted prices.

From June 20 to July 11, inquiries from Chinese investors regarding both residential and commercial properties in the UK rose by 30 to 40 percent compared to average levels. This uptick indicates a resurgence in demand from a key group of investors in a sector that had previously experienced a slowdown due to Brexit-related uncertainties.

Bernie Morris, president of the UK, Europe, and Middle East divisions of the platform, remarked, "With politics stabilizing and a competent new government in place, the UK looks like the same old safe haven as ever – but cheaper." The period mentioned marked one of the five strongest weeks for inquiries related to British properties this year, although details on completed sales were not provided.

Prior to the June 23 referendum, about half of Chinese investors paused their plans to invest in British properties due to a combination of domestic issues in China and uncertainties in the UK, as revealed by a survey conducted last month. The main reason behind the renewed interest appears to be the decline in the value of the pound, which has made property prices more appealing.

During that four-week timeframe, the pound fell about eight percent against the dollar and six percent against the yuan.

While this data indicates a positive shift in sentiment among Chinese investors, it contrasts with developments in the broader British commercial property market following the referendum. A survey from the Royal Institution of Chartered Surveyors highlighted that investment demand for commercial properties in the UK plummeted to the lowest levels on record post-referendum.

In early July, over 18 billion pounds of retail investor funds were frozen as several commercial property funds suspended trading to manage a surge in redemption requests. Additionally, some fund managers had to reduce the value of their UK property portfolios.

Chinese investors have been major players in the British property market in recent years, purchasing a wide range of assets from luxurious homes to prominent commercial buildings, primarily in regions such as London and Manchester.

Real estate professionals have indicated that many buyers, especially those from private equity backgrounds, are capitalizing on "Brexit discounts" of up to 10 percent on various properties as sellers become willing to reduce prices for assets, including offices and houses.