Hong Kong Buyers Swoop on London

UK-based developers are ramping up sales launches and marketing promotions in Hong Kong as the weakened pound makes British property more attractive.

Developers like Knight Dragon, chaired and majority-owned by Hong Kong billionaire Henry Cheng Kar-shun, and London Square have been actively marketing UK residential projects to prospective buyers in Hong Kong. Since the start of the year, the pound has fallen by about a fifth against the US dollar. At one point last month, it hit an all-time low of 1.03 against the American currency.

“Hong Kong buyers are able to buy at a huge discount right now and developers have noticed,” said Eli McGeever, a director at property research company One Global Labs. “There have been several new launches recently and developers are looking to take advantage of the currency play.”

While London home prices have risen 8.5% in the last 12 months, this has been more than offset by a weaker sterling for buyers paying in Hong Kong dollars. The cost of buying a home in London is “now 9.4% lower than this time a year ago”, according to Marcus Dixson, director of UK residential research at JLL.

London Square has just opened a 2,770 square-foot office in One Exchange Square in Central, which will serve as its international headquarters and showroom for its residential projects in the British capital. The developer’s sales campaigns, however, will be handled by a partner property agency in Hong Kong.

Hong Kong-based buyers typically account for between 20% and 60% of London Square’s projects.