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Chinese property buyers focus on Portugal and Singapore, Avoid risky geo-politically troubled cities
The golden visa scheme has turned Portugal into a hot market for Chinese investors.
Property investors from mainland China are sharpening their focus on Portugal and Singapore as alternative investment locations, while shifting more money out of traditional markets like the US and Australia and Britain amid concerns about fraying trade relations. Chinese buyers have rushed for homes in Lisbon to beat year-end deadline under Portugal’s ‘golden visa’ scheme and withdrawn from markets in the US, UK, Australia and Japan over the past two to three years since political ties worsened.
While the Covid-19 pandemic has tempered overseas trips, it has not deterred investors from hunting for overseas assets. Enriched by the recent stock market boom, they have sought long-term foreign residencies through passport-for-cash schemes, or diversified their investment basket into less volatile markets.
While the Covid-19 pandemic has tempered overseas trips, it has not deterred investors from hunting for overseas assets. Enriched by the recent stock market boom, they have sought long-term foreign residencies through passport-for-cash schemes, or diversified their investment basket into less volatile markets.
To many Chinese investors, properties in Singapore are highly attractive
Chinese investors accounted for US$21.7 billion or 5 per cent of global real estate investment activity from January to September this year, according to Real Capital Analytics (RCA), which tracks deals costing more than US$10 million. They contributed US$41.7 billion or 4 per cent of the total in 2019.
The flow of Chinese capital has been swayed by ongoing political tensions between China and some of its biggest trade partners. Relations with the US and Australia are souring due to sanctions and export bans, prompting mainland investors to look at Singapore and elsewhere to park their wealth. “In recent years there has been a consistent desire from PRC investors to diversify outside China to complement their domestic investments,” said Oliver Watt, a director at Savills’ London-based cross-border investment team. “We see notable pent-up demand.”
The flow of Chinese capital has been swayed by ongoing political tensions between China and some of its biggest trade partners. Relations with the US and Australia are souring due to sanctions and export bans, prompting mainland investors to look at Singapore and elsewhere to park their wealth. “In recent years there has been a consistent desire from PRC investors to diversify outside China to complement their domestic investments,” said Oliver Watt, a director at Savills’ London-based cross-border investment team. “We see notable pent-up demand.”
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In Singapore, Chinese buyers represented almost a quarter of the total foreign property purchases in the first three quarters this year, according to data from Cushman and Wakefield, a property consultancy. “Amid the turbulent regional economic and geopolitical conditions, foreign buyers [including Chinese investors] remain on the lookout for good deals in Singapore,” said Wong Xian Yang, Cushman & Wakefield’s associate director for research in Singapore and Southeast Asia.
Last quarter, their purchases of non-landed homes more than doubled to 271 from the previous quarter, according to data compiled by OrangeTee & Tie, based on statistics from the Urban Redevelopment Authority. “To many Chinese investors, properties in Singapore are highly attractive and many see the merits of staying or investing in Singapore especially given the positive capital appreciation of many properties here,” said Christine Sun, head of research and consultancy at OrangeTee & Tie.
The losers appear to be markets in the US, UK, Australia and Japan, as Chinese investors shunned them to steer clear of unsettling geopolitical risks and the number of Covid-19 cases. Deals involving these four spots have dwindled over the past two years and are likely to remain depressed in the near term, property consultants said.
Last quarter, their purchases of non-landed homes more than doubled to 271 from the previous quarter, according to data compiled by OrangeTee & Tie, based on statistics from the Urban Redevelopment Authority. “To many Chinese investors, properties in Singapore are highly attractive and many see the merits of staying or investing in Singapore especially given the positive capital appreciation of many properties here,” said Christine Sun, head of research and consultancy at OrangeTee & Tie.
The losers appear to be markets in the US, UK, Australia and Japan, as Chinese investors shunned them to steer clear of unsettling geopolitical risks and the number of Covid-19 cases. Deals involving these four spots have dwindled over the past two years and are likely to remain depressed in the near term, property consultants said.
News article from SCMP published on 19 Nov 2020
