Spurred by a domestic property debacle and a currency sell-off, Shanghai high-net-worth individuals hunt for overseas homes
- ‘Owning a flat abroad is a way of hedging risks now that home prices in Shanghai have dropped sharply,’ said a businessman keen on buying an Australian flat
- LPS Shanghai luxury real estate show received over 6,000 visitors as 150 exhibitors from 50 countries showcased their property projects to potential Chinese buyers
High-net-worth individuals in Shanghai are seeking refuge in overseas property investments as they flee a slump in mainland China’s real estate sector, and this flight is creating price pressure in both markets.
The queue of sellers is creating a supply glut. Homeowners now have to offer up to 20 per cent price cuts to lure potential buyers, according to You Liangzhou, the owner of Baonuo, a Shanghai-based property agency.
Meanwhile, the clamour for overseas assets is creating a different kind of pricing pressure in some overseas markets.
“More people are coming to New York than flats that are being built there,” said Thomas Guss, president of New York Residence, a real estate broker who was in Shanghai to attend a property fair at the weekend. “It creates upwards pressure [on home prices].”