National security law is unlikely to spark a surge in UK property investment among Hongkongers

Name: UK offers Hongkongers with BN(O) passports path to citizenship after new national security law
Uploaded: 2020-07-06T17:00:09.000Z
Duration: 1 min 38 s
Description: UK offers Hongkongers with BN(O) passports path to citizenship after new national security law

Hong Kong investors’ appetite for deals will be determined by how Britain’s property market adjusts to the Covid-19 shock rather than political developments

While there are signs UK property, in particular the London market, has been attracting more interest, expectations of a sudden surge in investment are overblown

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A woman looks at advertisements in an property agent window in southwest London on August 22, 2016. The new national security law has sparked increased interest among Hongkongers in British real estate, though concerns of a mass exodus of Hong Kong residents to Britain appear to be overblown. Photo: EPA

Nicholas Spiro

Published: 1:00am, 7 Jul 2020Updated: 2:54am, 7 Jul 2020

Beijing’s imposition of a draconian national security law, which prompted the British government to introduce a new path to citizenship for some 3 million Hong Kong residents who either hold a British National (Overseas) passport or are eligible for one, could boost demand for residential property in London.

Camilla Dell senses an opportunity. Dell, the managing partner of estate agency Black Brick, noted that, “over the past 18 months or so, we’ve already seen growing interest in London as wealthy Hong Kong residents make contingency plans. We now expect that trend to accelerate.”

The combination of a cheaper pound, a fall in capital values since the market peaked in 2014 and the new residency offer is likely to provide a boost to demand. Some Hong Kong buyers’ requirements are changing from a pure investment focus to properties that would also suit them to live in.

In a sign of the extent to which many residential agents and developers believe the security law and newly proposed citizenship scheme will spur demand for property in Britain, even some housebuilders in regional cities have started receiving more offers from Hong Kong buyers.

“Over the past few weeks, local agents [in Hong Kong] have been calling us non-stop to find out if we’re ready to launch a new UK product. We just sold five units [to Hong Kong buyers] but could have easily sold 50 or 60 over a weekend,” one Manchester-based developer said.

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UK offers Hongkongers with BN(O) passports path to citizenship after new national security law

However, while there are signs UK property, in particular the highly prized London market, has been attracting more interest from Hong Kong buyers since the national security law was first mooted in May, expectations of a sudden surge in investment are overdone. There is little evidence that the law itself or the citizenship scheme is a catalyst for increased buying activity.