Against a backdrop of an uncertain global macro environment, one constant continues to drive key Asian property markets: The Chinese buyer.
Mainland China investors, and their growing appetite for overseas assets, have been a key theme for the property market in recent years. But for two of those markets, Hong Kong and Singapore, the pattern of investment is notably different.
In 2016, Chinese groups invested $5.2 billion in completed properties and undeveloped land in Hong Kong Island and Kowloon, compared to only about $600 million in Singapore, based on figures from Real Capital Analytics.
"Chinese investors seem more interested overall in Hong Kong than in Singapore property," David Hand, CEO for Asia Pacific at real estate firm Colliers International, said. "In Hong Kong, Chinese developers and financial institutions have mainly purchased office property, while individual investors have mainly purchased residential property."
Investing in Hong Kong provides these investors a way to hedge against possible further RMB depreciation, but more than that, setting up a headquarters in the city acts as a strategic gateway for Chinese firms expanding beyond the mainland, market watchers said.