Chinese buyers continue to show interest in the UK property market, making 213% more enquiries in July.
This follows a double-digit decline in Q2 2020 during the height of the coronavirus pandemic. Chinese demand for UK property soared in July after plummeting between April and June, with the recent stamp duty holiday providing a further boost. Chinese buyers have fears of higher stamp duty in 2021 so are looking to act early.
Georg Chmiel, executive chairman at Juwai IQI, Asia's biggest PropTech group, commented: "Anyone who can bring their transaction forward to 2020 from next year or even later is doing so. Not only will the holiday expire, but foreign buyer stamp duty rates are set to climb by 2% next year.”
Chmiel says a large portion of Chinese buyers are purchasing for their children to use while studying in the UK, even if the actual dates of study might be years away. There is also a significant number of investors purchasing Build to Rent property, especially in second-tier cities like Manchester and Bristol.
"Prior to the stamp duty holiday, travel restrictions and pandemic fears were choking Chinese demand. The stamp duty holiday is a positive electric shock that has brought demand back to life,” he adds.
According to the study, in Q1 2020, Chinese buyers made 9.5% more enquiries on British property than a year ago. This dropped by half in Q2, with Chinese buyers making 54.1% fewer enquiries compared to last year.
Chmiel concludes: "In the first quarter, the coronavirus looked like it was going to be contained to China. Buyers looked for overseas destinations where they could escape it. In the second quarter, it became clear that the virus pandemic was in fact global. Many Chinese actually came to feel that they might even be safer in China than they would be overseas.”
Last month we explored research by UK-China PR agency 11K Consulting, which looked into the mind of a high-net worth Chinese investor to see what they are searching for from overseas property.