Abstract
Anxieties about the effects of international property investment in world cities like London have mainly focused on super-rich investors and corporate vehicles that have generated price inflation of assets and accelerated exclusion from an already expensive market. In fact, many international investors in the city’s housing market are middle-class individuals, and focusing on Hong Kong as an emblematic example of such processes, we examine their motives and the products offered to them by important investment intermediaries. We find that an important rationale for these investments lies in local class-based uncertainties and existential anxieties concerning the future of Hong Kong itself. We focus on the cultural roots of these investor rationalities but also consider the role of investment intermediaries who have helped bolster confidence while shielding investors from the consequences of their aggregated market power – concerns in London over household displacement from foreign investment. We suggest that what may seem to be the predatory search to ‘fry’ property (炒樓), a Hongkonger colloquialism referring to the search for high performing investments, should also be understood as actions anchored in and generated by the habitus of the Hong Kong middle class whose lives have been moulded by historical geopolitical uncertainty and worries about its longer-term social positioning and security.
Highlights
The uncertainties of investments in the built environment following the global financial crisis and the constitution of trading blocs and international economic systems have generated profound benefits for those citiesThe purchase of prime properties by individuals from China, Russia and the Middle East has been fuelled in part by the desire to safeguard wealth in an uncertain local political landscape
Rogers (2016a) has argued that with the economic rise of Asian countries such as China, their international real estate and landownership helped challenge the geopolitical primacy of the West
It tended to be the case that only Hongkongers who had children studying in the UK bought properties in London, but Trendy apartments in the centre of Manchester Ready-built apartments with rental contract are sold in limited quantity Predicted a 6 to 8% increase of property value in Manchester and the UK in 2014 £800 million worth of capital will flow into Manchester Airport Studio, one- and two-bedroom apartments available Manchester, third largest economy in the UK To provide up to 70% mortgage Prices starting from HK$1,348,529 Fully furnished and decorated the market has opened as developers sell newbuilds in second-tier cities
Summary
The purchase of prime properties by individuals from China, Russia and the Middle East has been fuelled in part by the desire to safeguard wealth in an uncertain local political landscape. Despite Hong Kong’s relatively small population of 7.4 million (end-2016) with a landmass of only 1106 km, its economic power continues to make an impact globally upon the UK and other property markets Behind these outward flows of money either in search of a home or purely for investment, we observe deep fears focused on political uncertainty around mainland China’s relationship with posthandover Hong Kong. Despite recent popular media coverage in the UK of wealthy investors from Russia and the Middle East purchasing prime and superprime residential properties in London, the history of international property investment from Hong Kong can be traced back to the late 1980s, when Hongkongers began to worry about the possible uncertainties after the impending 1997 handover. The interest rate is really low; it is much cheaper than renting
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