Unlike countries such as the US and South Korea, the UK is not one of China’s main trading partners. Therefore, the UK housing market is not likely to be as affected if the Chinese housing market does collapse.
However, it will still be affected due to the number of Chinese investors in the UK housing market. Ever since Brexitthe number of Chinese investors has risen by considerable amounts.
Between 2013 and 2019, there was a rise of over 10% in the number of mainland Chinese investors accounting for purchases of properties worth over £1 million. Three areas of London (Kensington, Chelsea and Westminster) saw Chinese investors bring over £500 million worth into the country in 2019 alone.
If there is instability back home, this may cause a decrease in the number of Chinese investors. Due to repeated COVID lockdowns, the Chinese economy is tighter in general, and a decrease in investors is expected. Therefore, we can expect less money coming in from China, which may have an impact on more expensive property markets such as London.
However, this void that could potentially be created in the coming months from Chinese investors pulling out creates opportunities for other investors to branch out their portfolios. We could see more foreign investors coming into the UK, making the most of the weakness in the pound right now.
A gap in the market is one waiting to be filled, and this is an opportunity that investors should be looking to spring on if and when the time comes to make the most of it.
