China, once described as “the workshop of the world”, has been experiencing reduced demand for its goods and services for a number of years. In 2016 this resulted in a stock market crash that reverberated across the globe. The outlook continues to look bleak, and in recent months US President Donald Trump’s hard line position against China has done little to improve confidence.
These are uncertain times, so perhaps it’s not surprising that successful business people who have built up wealth over the last decade have started to look beyond their homeland to secure their future prosperity. The average age of this high net worth group is between forty and fifty years old (on average, ten years younger than their western counterparts), which means that they are active investors, eager to explore opportunities, even if they lie half way across the globe.
Inevitably these elite, super-rich investors are drawn to stable European countries with strong democracies and property laws that offer protection for overseas buyers. Not all are driven solely by a desire for long-term investment: many buyers are looking to establish a foothold in a country with a good lifestyle, where their children can go on to study in some of the finest universities in the world.
Although Britain is currently dealing with uncertainties of its own (as it negotiates an exit from the European Union) it is one of the most favoured spots for Chinese investors, and not just because it provides a safe haven to store money. Owning London property is viewed as a status symbol amongst this group and the capital’s excellent schools are another inducement to buy here.
China’s economic problems are unlikely to be resolved quickly and Chinese buyers have shown no sign of falling out of love with UK property investment so far. There is also huge potential for future growth: out of a population of 1.4 billion in China, it is estimated that 120-150 million belong to the middle classes. It may only be a matter time before middle class investors who have lost confidence in the domestic market begin to follow in the footsteps of their super-rich bosses.
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