Liverpool's Chinese & Hong Kong buyer boom

There has been a significant influx in the number of Chinese and Hong Kong buyers purchasing homes in Liverpool between 2017-2021, up by 170% in that time, which has been attributed to a 60% discount compared to buying in London.

A new survey carried out by Beauchamp Estates, in partnership with Logic Estates, found that some 35,000 homes (circa £8.75 billion worth of property) in the city are now linked to Chinese and Hong Kong residents.

Liverpool, the new investment hotspot

With homes being an average of 679 sq ft in size, or 775 sq ft in size for a premium unit, the new survey discovered that properties in Liverpool average £237 per square feet and average £228 per square feet for a premium new home – the top 25% per sq ft by value.

The data compiled for Liverpool can be compared to equivalent figures of £678 per square foot for London (£802 per square foot for premium units) at an average size of 688 square feet (or 775 square feet for a premium unit).

Broadening the scope to Manchester units go for £353 per square foot (£399 per square foot for premium units) at 664 square feet or 753 square feet in size and if we look at Birmingham a unit will be £300 per square feet (£351 per square feet for premium units) at 632 square feet or 742 square feet in size.

An attractive city to invest in

With a hefty average budget of £1.5 million to invest in UK residential property, the price comparisons underline that buyers from China and Hong Kong can typically buy one apartment in Prime Central London, two in London Docklands or five or six apartments in Liverpool.

Additional benefits include that the units in Liverpool are both cheaper in terms of cost per square foot and more prominent in size than the equivalent properties in London. Other regional cities such as Manchester and Birmingham also offer price and size advantages over the capital which is why there has been a drastic uptick in Chinese and Hong Kong investors buying UK real estate over the last five years, investing in regional cities beyond London.

Of the homes in Liverpool linked to Chinese and Hong Kong residents, 27,600 (worth £6.9 billion) are either purchased buy-to-let investment units or investment properties rented to Chinese and Hong Kong students or businesses.

Other homes that are linked to Chinese or Hong Kong residents (7,400 homes, worth £1.85 billion) are owner-occupier or pied-a-terre units used by Chinese/Hong Kong nationals, or descendents who are now naturalised, British passport holders.

Europe and Asia collide

The survey highlights that Liverpool is also appealing to Chinese and Hong Kong investors because it has the oldest and most established Chinese community in Europe.

The first presence of Chinese residents in Liverpool dates back to 1834 when the first vessel direct from China arrived in the city and by the 1860s there were many Chinese migrants living in Liverpool as a result of Alfred Holt & Company employing large numbers of Chinese seamen in the Blue Funnel Shipping Company.

Beyond the 1890s, Liverpool's now-famous Chinatown centred on and around Berry Street started to be established, and by the late 1940s, there were over 5,00 Chinese residents in Liverpool, a figure which has grown to some 35,000 to date.

The survey highlighted other factors which had drawn Chinese/Hong Kong real estate investment to Liverpool, namely the city’s growing population and good educational facilities, both essential features for attracting tenants and ensuring no/low void periods.

The University of Liverpool is a UK top 40 studying facility, and the city is a leading UK hub for computer science research and IT innovation firms.

Jeremy Gee, managing director of Beauchamp Estates, says: “Our new survey shows that over the last five years mainland Chinese and Hong Kong investors buying residential property in the UK have expanded beyond London to invest in Liverpool, Manchester, and Birmingham. In particular, there has been a massive wave of Asian inward investment into Liverpool and the city is becoming Shanghai-on-the-Mersey. Buy-to-let units in Liverpool are often +60% cheaper than their equivalents in London and up to double the size.”

Tobacco Warehouse at Stanley Dock on the Liverpool Waterfront was used as an example in the survey where there will be 550 one, two, and three-bedroom Manhattan-style loft apartments priced from £235,000.

Currently under construction, the development has 190 apartments complete and over 100 new homes inside the Grade II-listed former Victorian warehouse are now sold/reserved – a substantial number to mainland Chinese and Hong Kong investors.

The data found that Chinese and Hong Kong investors at Tobacco Warehouse were paying an average of £252 per square foot to buy a loft averaging 1,309 square feet – compared to equivalent values of £802 per square foot and 775 square feet for similar apartments in London. This means that Asian investors were buying Liverpool units that were 60% cheaper, yet almost double the size of their London counterparts.

Paul Finch, new homes director at Beauchamp Estates, also weighed in, saying: “Our survey shows that buyers from China and Hong Kong with a budget of £1.5 million to invest in UK residential property can typically purchase one apartment in Prime Central London, two in London docklands or five or six apartments in Liverpool. This is why the Liverpool housing market has seen an inward wave of investment from Asia. Apartments in Liverpool on average offer more space than apartments in other cities like London.”

“For example, the Tobacco Warehouse loft apartments, where there have been sales to Asian buyers, are significantly larger than other apartments that have sold across Liverpool in recent times. With hybrid working ever more commonplace, space and layout are key considerations for domestic buyers, overseas investors, and renters alike which is why this scheme appeals to buyers from China and Hong Kong.”

Liverpool in the process of an expensive upgrade

Liverpool’s waterfront and city centre area are currently undergoing a £14 billion regeneration with key projects including the new cruiser liner terminal near Alexandra Tower, the new Everton Stadium which is scheduled for completion in 2024/2025 as well as the £250 million regeneration of Stanley Dock providing amenities such as a hotel, apart-hotel, restaurants, health clubs and new homes.

Over the past five years, Liverpool has seen a 44% rise in the population aged 19-30 (some 30,000 per year have moved to the city), compared to a 42% rise for Manchester, 19% for Birmingham, and a -7% outgoing figure for London.