Hong Kong migrants seeking property in the UK need hand-holding, and sometimes a reality check on what they can afford, UK agents say
- Agencies focused on Hong Kong buyers are seeing fewer investors and more who intend to own and occupy, but not a sharp increase in purchases
- Agents are providing more services such as advice on taxation and mortgages, as well as guidance about what and where clients can afford to own
Real estate agencies in the United Kingdom are providing more “hand-holding” for an influx of first-time buyers from Hong Kong, many of whom arrive without knowledge of how the buying process works and – in some cases – with inflated expectations about what they can afford.
A regular advertising campaign run by Savills drew more interest in the past year from those without previous buying experience, despite overall sales having plateaued, according to Mark Elliott, Hong Kong-based head of international residential sales for the agency.
“The respondents [to the campaign] were very different to what they have been over the last five years,” he said. “These are people who are new to London and haven’t been looking at London before.” They therefore have a weaker understanding of the local property market, he added.
“We’ve had an increase in enquiries specifically because buyers don’t know at all what they’re looking for,” he said. “They come with a budget and an idea in mind - because a friend or a family has told them [buying UK properties] is a good idea.”
The surge in inquiries does not, however, equate to an equally sharp increase in properties purchased, he added.
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Agents are increasingly providing packaged services to the new wave of clients, including advice on taxation and mortgage applications.
“More hand-holding is needed during the sales process,” said Timothy Wu, managing director of property seller Fulcrum Global. It is common for new buyers to be unaware of the process of buying properties in the UK, which he described as less efficient and less standardised than in Hong Kong.
“Many were making purchases at property events in Hong Kong, without having the chance to visit [the properties] themselves,” Wu explained, but as demand stabilises, more are choosing to rent and adjust to the new environment before buying.
As of last year, 104,000 Hongkongers had applied to relocate to the UK under the BN(O) programme, with 93 per cent of them winning an approval, according to government data. As many as 322,400 immigrants from Hong Kong are likely to purchase a home in the UK through 2026, according to estimates by the British government.
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Before 2019, Fulcrum’s clients were almost entirely investors, but now 40 per cent are owner-occupiers, reflecting the growth of migrants, some of whom arrive with unrealistic expectations.
“There have been situations where potential buyers had expected HK$1 million (US$127,000) to be enough to enter the British property market, especially in regions other than London,” Wu said, “but an apartment in Manchester could easily cost HK$3 million to HK$4 million.”
Potential homebuyers with insufficient funds will often be recommended to more affordable neighbourhoods outside London, which have seen an increase in demand.
“Many of them would prefer to live within London,” said Jeff Kwok, marketing manager of Imperial Dragon Property. “But often when we find out their budgets, we’d let them know that their expectations may not be possible and refer them to developments outside London, including those in Kent, Sutton, and Reading.”
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Others, especially those who are still looking for employment, end up shopping for flats instead of single-family homes. Of the properties Imperial has sold to Hong Kong buyers, around 65 per cent were flats and 35 per cent were houses, according to Kwok.
Hong Kong buyers play a small part in the British property market, according to Eli McGeever, director of research and technology innovation at One Global Property Services’ in-house research team.
“Hong Kong buyers are amongst the top overseas buyers of UK properties,” McGeever said. “However, they are still just a drop in the ocean, compared to the local market.” Price growth is “not really” caused by foreign buyers, and the growing interest among Hong Kong buyers in properties outside London will not have a sizeable impact, he added.
Savills’ Elliott agreed. “On average, UK house prices double every 10 years,” he said. “I don’t think the hundreds of buyers from Hong Kong will affect prices drastically, despite what we read in some UK papers. That said, it remains to be seen.”
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Elliott also shared Wu’s observation that more are now inclined to rent: “Most ‘BN(O) buyers’ will rent for a few years, and buy once they’ve established where they want to be,” he said. “It won’t have a huge impact on house prices but will push rental values up in popular destinations.”
A five-bedroom residence on the outskirts of London would typically cost between HK$5 and HK$10 million, he said. While Manchester and Birmingham remain the second and third most popular cities for Hong Kong buyers, Cambridge, Oxford, Bristol, and Brighton are rising in popularity.
