Hong Kong buyers tempted to tap into English old-world property
It's not just big developers who are targeting Chinese investors looking for something unique
For sale - a beautiful British early-Victorian restored house of an incredibly spacious 5,500 sq ft, with wrought-iron supports for the cute veranda, right on the water; a snip at £1.35 million (HK$16.65 million) and overhauled by an interior designer and her psychiatrist husband.
But it's in Norfolk?
It's been common for British developers to seek Hong Kong buyers for their properties. Now entrepreneurial and well-travelled expats are doing the same.
In this case, it's Anji and Barry Connell - she's the designer and he's the psychiatrist - who renovated a storied property known as The Bathhouse in Cromer, on the north Norfolk coast and are looking for a Hong Kong buyer.
The couple lived in Hong Kong for 11 years before returning to Britain in 2000, to renovate The Bathhouse, a beachfront property with a spa bathroom and its own cinema room.
Although the property is also on the market in Britain, property sales outside London are moribund at the moment, given the state of Europe's economy and the lack of easy credit. Now that they are returning to Hong Kong, and find it hard to manage the large property, they are hoping a Hongkonger might be looking for a first or second home in Britain.
They bought it for £180,000 and say they spent £1.1 million on the renovation.
"It's a substantial property for a very small amount of money. It's a beautiful house in a beautiful part of the country," Anji Connell said. "You can walk out the door and you can walk for miles and miles on the beach."
Of course, Hongkongers are flooded with offers to buy British property, with adverts, fliers and shows virtually every weekend in places such as the Landmark Mandarin Oriental's Tian and Di rooms. At Fitzroy Place, a central London project developed by Exemplar and the asset manager Aviva Investors, 30 per cent of buyers are from Hong Kong.
Developer Land Securities says Hongkongers accounted for a quarter of Asian buyers of London property between November 2010 and April last year, with another 10 per cent from the mainland and 12 per cent from Singapore. It is making Hong Kong the first stop on its sales tour for Kings Gate, a project set to be launched in January.
"We have always seen a strong interest from Hong Kong and mainland investors," said Tom Eshelby, the company's residential director. He cited a report showing that Asian buyers had shifted their focus from smaller, cheaper flats to larger, two- to three-bedroom apartments ranging from £400,000 to £800,000.
But that's London. Luxury brokerages such as Sotheby's and Engel & Volkers have no shortage of French chateaux, South African game parks and German castles for sale.
Sellers can expect long lead times and have to wait for the right buyer. More often than not, they are local or live nearby, making The Bathhouse a tough sell.
"I'm sure it's a really special place. But we do get a lot of very, very special places," said Chris Liem, the owner of the Hong Kong branch of Engel & Volkers. "You are talking about a global buyer who has unlimited options. If I'm a global buyer, why would I want to buy something in Norfolk?"
The British market has split into two, though, brokers say, with prices in central London strong and rising, while the rest of the country is flat at best, if not posting losses. More individual sellers may start looking to target cash-rich buyers in Asia. For now it is still unusual for individual buyers to market their properties overseas. Richard Drummond, the marketing manager for the international properties division at Colliers International, said his company works mainly with large-scale projects by well-known developers.
Hongkongers and mainlanders are used to buying off a plan, which makes them attractive to developers, who can use the cash flow to fund construction, and favour new properties.
One broker who sells British property in Hong Kong said properties such as The Bathhouse are an emotional buy, destined only to fall into the hands of someone who falls in love with Norfolk, the town of Cromer, the beach and the house. He prefers less risky, less emotional bets.
"People would want to go and stay in that area and see that they liked the local pub before making their purchase decision," he said. "You're probably better off buying something in Hong Kong or London, or America, and when you go on holiday staying in the Four Seasons."