Asian HNWI still love a slice of London luxury


And in order to stay competitive, UK developers should offer these features…

White stucco houses are synonymous with luxurious central London. Image: J R Prante/Shutterstock
White stucco houses are synonymous with luxurious central London. Image: J R Prante/Shutterstock

By Neil Jensen

It was recently reported that 60 per cent of Chinese high-net-worth individuals (HNWIs) plan to buy property abroad within the next three years, with the UK the second most popular destination on their list.

Property has now become the most popular overseas investment for China’s rich, with the main considerations for rich property buyers being value for money, rate of return, and help with immigration status, respectively, when choosing real estate abroad. However the primary concern for Asian investors is value for money.

We have noticed a common trend arising whereby many buyers are seeking properties in London that offer hotel-style living, in order to mirror the lifestyle they have become accustomed to overseas. Another driving force behind the requirement for luxury facilities is the ability to fit in leisure activities such as going to the gym or a spa around an extremely busy lifestyle. An increasing number of new developments, particularly in London, are offering these facilities and this has been driven by growing consumer demand and a change of buying habits. Investors today not only purchase a property to be lived in, but they buy into a particular lifestyle; in this case favouring luxury living.

We have noticed when marketing new developments to international investors that if they are going to buy a brand new property, they require additional facilities and amenities that give them security and confidence. These buyers do not like the idea of a regular house whereby anyone could knock on their front door, they like exclusivity and the concept of an all-inclusive community, meaning that they do not have to step outside of their immediate vicinity unless they wish.

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In order to remain competitive in the London market, developers need to ensure that they can offer benefits such as a 24-hour concierge service, private leisure and health club access, exclusivity and privacy. These are all now considered ‘must haves’ for wealthy Asian investors.

International buyers seek a home in areas of London that they are familiar with. Paddington has become a real hotspot since plans were announced for Crossrail services in the area and of course central London remains in high demand due to the many tourist landmarks such as Big Ben and the Houses of Parliament.

It may sound obvious, but when marketing a London development to overseas investors, it is imperative to reinforce the features and benefits that these investors are seeking. For example, if a buyer is looking for a home for their child to study in the UK, how far is it from the leading Universities? What are the transport links like into central London? Is the property in an area with potential for price growth? For a London-based agent such as Fraser & Co that operates overseas, you need to guide and educate buyers who may not be familiar with the UK property market and ensure the property you are selling is the right option for them. For Asian investors, this is typically a modern, luxurious apartment located within zone one or as close as possible to it, with everything they could need on their doorstep.

At a time when house prices are rapidly rising in China, with some cities seeing a 30 to 40 percent, or even 50 percent increase year-to-date, the UK will remain a target for investment. For as long as developers and agents continue to work together to offer buyers good value from a property that truly compliments their lifestyle and addresses their needs, the UK is likely to remain in a good position to continue benefitting from overseas investment, particularly in the property market.

Neil Jensen is Regional Director, Middle East & Asia at Fraser & Co.

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Neil Jensen is Regional Director, Middle East & Asia at Fraser & Co.