Rich Chinese buying up houses in Europe
Updated: 2011-01-21 10:39
By Andrew Moody and Yan Yiqi (China Daily European Weekly)
Rich Chinese are increasingly being attracted to the property market in Europe, particularly UK
The yuan may not be monopoly money but it is good enough for many Chinese to stake their claim on Mayfair, Park Lane or Bond Street. Those with Chinese currency are not playing a board game, however - they are buying up million-pound-plus apartments and houses in prime central London for real.
According to Knight Frank Residential Research, more than one in 10 of all buyers of new properties in central London are now from the Chinese mainland or Hong Kong, with many mainland buyers channeling money through the special administrative region.
Although, the Chinese are also looking at other areas of Europe, including old world castles and chateaus with vineyards in France, and the sunny southern Spain costas, London remains their central focus.
Some are hiring Mandarin speakers and Savills, the leading international estate agent, has even set up a dedicated China Desk in its head office in Berkeley Square.
Few major developments are now put up for sale in London without potential Chinese buyers in mind with advice on feng shui being taken and some apartment blocks having no floor numbered four, considered an unlucky number for the Chinese.
With the pound falling against the dollar by 25 percent since 2008 and with property values well below their 2007 peak, London property appears a once in a lifetime buying opportunity for Chinese investors and many want to get in before these factors change.
Sebastian Warner, partner in residential development at Knight Frank, says many Chinese are rushing to take advantage.
"Hong Kong has been a massive market. It has always been significant but the last year-and-a-half has been dramatic," he says.
"It is often difficult to determine whether the people we are selling to are feeding mainland money through Hong Kong or are people who have moved to Hong Kong and have taken their money with them."
Individuals are restricted to sending the equivalent of $50,000 (37,119 euros) a year out of the country. Some people try to bypass these restrictions by using underground money exchangers in southern China.
Those buying central London property often fall into the super-rich category, however. They typically have companies in Hong Kong and have both corporate and personal accounts there, from which they can transfer funds to buy property.
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