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Chinese Investors

The proportion of upper-middle-class in China is growing year by year, making them one of the top wealthiest natioanalities in the world. According to Statista in 2020, the countries with the largest number of billionaires were China and the USA. China had 799 in 2020, up from 609 in 2017, while the USA had 626 in 2020, up from 552 in 2017. China has consistently ranked first among all other countries in these recent years. 

While the pandemic initially hurt the wealthy in China, almost a year later the total wealth of China’s 400 richest soared to $2.11 trillion, from $1.29 trillion a year earlier. This 64% gain is largely due to easing of capital-market rules and an economic rebound that enabled China to pull ahead of other countries in terms of recovery from the pandemic. Compared to the USA, China’s wealth engine is more in tune with creating new wealth. This year according to Forbes there were 68 newcomers to the China’s rich list, while only 18 in the USA list. 

Rising of Chinese Investment in Overseas Properties Market

The amount of Chinese investment in the overseas properties market has been rising in recent years. It amounted to a total of $101.4 billion (£72.1 billion) in 2016, a growth of 16.7 % in comparison to the year 2015. Below you can see in the graph how Chinese outbound real estate investment has been accumulating year by year up to 2019. According to the Hurun Chinese Luxury Consumer Survey 2020, Chinese high net worth individuals are currently putting 12.5% of their wealth into overseas assets, with London being the most popular investment destination. 

The weakness of the British Pound from Brexit has made holidays, business trips and study very attractive among China’s wealthy. At the moment residential property acquisitions are made largely by the parents of Chinese students that are currently enrolled at one of UK’s universities. According to Kai Tak, the UK is the number one destination for Chinese students wanting to study abroad. Boris Johnson’s decision to extend the post-study overseas student visa to two years has also helped to fuel this demand. 

In terms of housing priced above the £1 million mark, buyers from China have increased exponentially in recent years. According to Knight Frank, in 2013 Chinese buyers only accounted for 3% of all £1 million homes sold, while in 2019 it rose to 13.4%. These figures reflect investors strong appetite for more expensive housing, while in the future it is expected to grow even further.