More Shenzhen Residents Investing in Housing Market in Hong Kong
A dropping yuan, slow growth rates and stock market gloom are pushing rich Shenzhen investors to place their investments in a more stable market namely the Hong Kong property market. As exchange rates of the yuan drops, a number of rich Shenzhen residents are traveling across the border to buy high-end properties in Hong Kong. To an extent that the trend became a result of the devalued RMB, and since the Hong Kong dollar is pegged to the US dollar the yuan devaluation has pushed mainlanders to raise the percentage of overseas assets.
Ten percent of buyers are coming from the Chinese mainland, a percentage of 3 to 5 percent. Before Shenzheners choose to purchase apartments which costs around HK$ 5 to HK$8 million yuan as investments, while more are purchasing apartments worth HK$ 10 million for themselves. Meanwhile Hong Kong developers got rid of the 15 percent stamp duty on mainland buyers, which in turn attracted more buyers are Hong Kong witnesses a higher number of mainland buyers during the second half of 2015. Midland Holdings released statistics that showed buyers of newly developed apartments HK$10 million or higher in the first quarter about 41 percent were Chinese mainlanders while pre-owned housing had 12.8 percent mainland buyers.
Housing estates that developed Stars by the Harbour are also popular as 70 percent of the 120 apartments it brought to the market that averaged HK$22 million is sold out. The exchange rate of the Hong Kong dollar is not as volatile as that yuan and the value of Hong Kong housing properties is more guaranteed. In the coming months high end properties will be more popular as the U.S. will not raise its interest rates within the year.