Vincente Lee has been trawling trough British property websites from his high-rise flat in Hong Kong and, for once, he is grateful for the city’s exorbitant prices.
While Mr Lee awaited details of a UK government plan to grant almost 3m Hong Kongers a path to citizenship, he did his sums — and the figures bode well.
The 47-year-old Mr Lee calculates that selling his 800 sq ft flat in a suburb 45 minutes from Hong Kong’s financial district would generate enough money to buy up to three semi-detached houses in Kent, his target destination.
He said rocketing property prices in recent years meant his home is worth about HK$8m ($1m, £810,000), outpacing price gains in Britain.
“With the money I’ll have left from selling my property in Hong Kong and buying a semi-detached house in Kent, I will still have a few million Hong Kong dollars, so could buy another apartment as an investment,” said Mr Lee, who sources food and beverages from around Asia for retailers.
His money would go even further in Scotland, but his wife vetoed his plan to move to Inverness after realising how far north it was. As a compromise, Mr Lee hopes to buy an investment property in Glasgow, where he attended university.
On Wednesday, the UK government set out details of the scheme to offer visas to Hong Kong-resident holders of British National (Overseas) citizenship, a status held by around 3m people in the territory born before the handover to China on July 1 1997.
The UK Home Office, normally seen as keen to limit immigration, said applicants would have the right to bring dependants who did not hold BN (O) citizenship with them.
Applicants will have the right to apply for either one five-year visa or two 30-month visas before qualifying to seek indefinite leave to remain in the UK after five years. They will be eligible for full UK citizenship after six years.
BN (O) passport holders in Hong Kong are weighing their escape options as many in the city fear they could run afoul of the broadly defined law.
For many Hong Kong property owners such as Mr Lee, the city’s high prices could help ease the move overseas.
The average property price in Hong Kong climbed to $1.25m this year, according to CBRE’s Global Living 2020 report, making it the world’s priciest market and twice as expensive as London, where the average is $624,225.
And Hong Kong again topped the list of most unaffordable global property markets compiled by Demographia, despite the effects of political unrest and the US-China trade war on the city’s economy. The median house price is 20.8 times the city’s median household income.
It is not just the “average” homebuyers from Hong Kong who are causing excitement in the UK.
The Hong Kong rush to buy property overseas has been met with delight among London’s high-end agents, whose sales had ground almost to a halt following the coronavirus outbreak.
Fred Scarlett, sales director at developer Clivedale London, said that interest in flats at its Mandarin Oriental Mayfair scheme had risen markedly recently, with close to two-thirds of inquiries coming from Hong Kong buyers. Apartments in the development cost between £3m and £10.5m.
Gary Hersham, director of London agency Beauchamp Estates, said that “mainland [Chinese] and Hong Kong investors have become the leading overseas buyer group purchasing luxury London property” in the past year. “Their dominance in the market has grown despite the Covid-19 pandemic,” he said.
Beauchamp was involved in the sale of a home for more than £200m to Cheung Chung-kiu, chairman of Hong Kong-listed CC Land, this year. The property is the most expensive home ever sold in the UK.
Buggle Lau, chief analyst for Midland Realty, said Hong Kong’s property market had been on a “rollercoaster” over the past two years, but a rebound in June meant prices were now 1 per cent higher than the end of 2019.
“It’s pretty amazing that even with the social unrest last year, Covid-19 and the national security law that property prices have remained quite steady,” he said. “It’s quite resilient.”
The 2,100 new flats sold in May and June exceeded the total number of transactions in February, March and April, Mr Lau said, after the pandemic delayed property launches.
Despite the UK’s citizenship offer, Mr Lau does not expect an exodus from the territory as many middle-class residents have already secured overseas passports. And he does not foresee any panic selling from people looking to fund immigration plans.
Hong Kongers are already familiar with buying UK property and it ranks as the top overseas investment market, according to Mei Wong, head of international sales with Knight Frank.
The historical link between the UK and Hong Kong, as well as its quality schools and universities and a weak pound, add to its attraction, Ms Wong said.
Interest in UK property is now higher compared with six months ago, with about 15 to 20 per cent more inquiries from potential buyers, she said. Most buyers have a budget of about £500,000 to £1m.
Sam Kwok, 38, said the national security law represented the latest attempt by Beijing to turn Hong Kong into just another mainland city. He fears the legislation means that his children, aged 5 and 2, will be “brainwashed” at school.
Mr Kwok plans to make a clean break from the city and intends to sell his two flats, which are worth about HK$13m, and move to the UK.
“I feel it is no longer the old Hong Kong,” he said. “It’s meaningless to come back to Hong Kong.”
Additional reporting by Robert Wright in London