Expats go for country life
WITH the onset of the handover next year, greater numbers of Hong Kong expatriates are looking for countryside properties in Britain, estate agents say.
David Coreth, Hong Kong director of Hampton's estate agents, said the market appeared more favourable to buyers because it had stabilised and there was a greater number of homes coming on to the market.
This followed a dearth in supply during 1994 and 1995.
The country house market was helped by the influx of financial services workers who were using information technology to allow them to work outside the City of London, he said.
With interest rates continuing to plummet, the cost of borrowing was at its lowest for 30 years, making property buying more affordable.
According to Colin Mackenzie, head of Hampton's Country House Department, the market for luxury rural homes began to pick up at the end of 1994 when there was a shortage of London commuter homes in the Home Counties.
He said affluent returning expatriates tended to fall into two groups when buying country properties.
Older returnees, whose children had left home, tended to look at GBP350,000 (about HK$4.2 million) to GBP450,000 houses with three or four bedrooms in Gloucestershire and Avon.
Younger expats with families who needed to be within commuter distance of London sought houses with five to seven bedrooms in the southern counties, principally Kent, Surrey, East Sussex, West Sussex and Hampshire.
Prices for these types of properties could vary enormously depending on their location. A five to seven-bedroom property in Surrey cost GBP670,000, while in Kent the prices were between GBP500,000 and GBP550,000.
Mr Mackenzie gave Surrey's better road connections to London and close proximity to Heathrow and Gatwick airports as reasons for the relatively expensive properties there.
Estate agent Strutt & Parker has reported a surge in interest in country homes at the expense of the London market among Hong Kong buyers.
In its winter survey the agency said the country house market had been patchy for much of last year.
Demand for houses located within commutable distance of London, particularly those where road communications had been improved, was higher than at the height of the property market in the late 1980s.
But in relatively inaccessible Norfolk the story was different. There, prices were lower than they were at the bottom of the recession. Country house prices rose 17 per cent nationally since they hit bottom in 1992, property consultants FPD-Savills said.
Following a lacklustre year in 1994, house prices in western England rose the fastest among the British regions at 6.4 per cent in the 12 months to September 1995.
Property values in eastern England were five per cent higher over the same period.
In the Home Counties around London, prices edged up four per cent over the 12 months to September.
Property values remained 16 per cent below their 1989 peak in the Home Counties, although this had been the area of strongest recovery.
Therefore, substantial price rises could still be on their way, because the full potential of a bounce-back in prime country house values remained unrealised, the report said.
FPD-Savills expected to see overall growth of four per cent for luxury rural homes in 1996, with price rises concentrated on those areas which had not yet experienced much of an uplift.