People scouting for properties in Canada and U.K. as unease surrounding Hong Kong's political future grows amid China's increasing influence.
As the protests continue in Hong Kong there are plenty of real estate brokers in Canada and the U.K. who are receiving a large amount of inquiries from investors, who are from Hong Kong who are eager to get out.
Before, it was usually a ratio of five mainland Chinese to one Hong Kong buyer coming to open-houses, he said. “It has completely flipped now,” said Scarrow. “Whether or not that actually translates into deals, that comes down to what continues to happen in Hong Kong.” Says Dan Scarrow, Realtor.
Citizens from Hong Kong have been looking for properties in cities including Toronto, Vancouver and London, as the protests of Hong Kong worsen, and its political future grows amid China's increasing influence. A drop in residential property prices is making some of these cities attractive.
“Hong Kong money could become a major source of capital,” said David Ho, a broker at CBRE Ltd. who deals with Asian investments. “People are shocked, given Hong Kong was always branded as a stable, rule-of-law financial hub, and now want to move their capital to other cities to mitigate the risk and also to look for other homes.”
A look at few of the markets that are of interest to the Hong Kong buyers:
The advantages of Vancouver home owners.
As you already know Vancouver's housing market has not been doing very well for the past year, however it may be the first city that will benefit from these protests in Hong Kong.
Changes in Vancouver tax laws have pushed property prices lower since 2018, Knight Frank LLP said in a report, adding that investors will also benefit from currency-adjusted discounts of 17 per cent over the last year. Luxury homes were hit hardest by property tax changes, this caused a major drop in the price of mansions in the last few months leading to more incentives for buyers. With the city being home to a large Asian population, Vancouver is an appealing choice for many Hong Kong buyers.
“The tsunami tide of capital coming overseas in the last 10 years displaced a lot of old Hong Kong money,” CBRE’s Ho said. “Now, Hong Kong capital is looking at the price correction in Vancouver as an opportunity to get back in the market.”
Toronto
Ho’s team is working on more than $400 million (US$306 million) worth of potential deals for the likes of high-net worth individuals and publicly listed companies who want stability and attractive yields from the city’s real estate boom.
Canada’s biggest city is on its way to emerging as a popular choice for commercial and residential property investors given the strength of its housing market, which is partly driven by growth in technology and financial services industries. A weaker Canadian dollar may also mean attractive yields on some deals.
“People are looking at the future, especially people who are young professionals in their late 20s or 30s,” Robert Veerman, a CBRE sales representative who works with Ho, said. “They still have 50 or so years of professional life ahead of them essentially and the question is where’s the market, jobs, growth going to happen?”
BREXIT DISCOUNTS
The high demand for the top 5 per cent most expensive London residential properties has surged from Hong Kong this year, this is representing about 6 per cent of all prospective purchasers registering in the market, according to Knight Frank. However as Brexit moves on and becomes more clear to everyone, in the next 12 months the investment is bound to grow, the property consultancy firm said.
“We have suddenly had a lot interest from our clients in Hong Kong,” Joe Bond, an FX Counsellor at Citigroup Inc., said at a luxury property event hosted by Harrods Estates, Taylor Wimpey Plc and Citigold Wealth Management in London earlier this month, noting that the recent instability encouraged potential buyers to make offers.
Thanks to uncertainties around Brexit, including a weak pound and cheaper prices, London offers the greatest residential price discounts relative to the other major markets reviewed by Knight Frank. Prime residential costs in London are 28 per cent lower for Hong Kong buyers than they were five years ago. This makes it very easy and cheap to buy for many of the people who are living in Hong Kong now making it an excellent choice.
If you would like to learn more about Hong Kong's protests and how they affect the housing markets in Vancouver, Toronto and London or, if you are thinking about buying or selling your properties, please contact Matt Gul, who is a top luxury real estate agent situated in West Vancouver, who can help you with all of your needs. To contact Matt Gul please call him at 778.888.8888 or email him at matt@mattgul.com
Summarized by: Onur Gul on instagram at @onurguldrone