Research carried out by IP Global reveals that Hong Kong has fallen from the number one spot for active international investment. The UAE have surpassed Hong Kong for international investment for the first time since studies began.
The study identifies where global investment has been invested worldwide. The UAE itself is projected to return 2% economic growth for 2018, with this rising to 3% in 2019, being one of the largest growths worldwide. This is the reason for the UAEs substantial rise in international investment.
Hong Kong investors however are still highly active, and research shows that 84% of Hong Kong investors stated they have active investments, with 78% saying that they plan to invest in the next 12 months.
Hong Kong investors remain highly interested in investing abroad, with the UK being the third most attractive location for property investment, behind Japan and Thailand. Respondents identified that potential capital gains, rental income and portfolio diversification were the main factors for international investment.
Rental income in the UK is set to rise substantially. Current estimates carried out by the Royal Institution of Charted Surveyors (RICS) predict rental prices to rise by 15% over the next 5 years, fantastic news for HMO Property landlords. This is largely cited to be due to a supply shortage in the UK, with this rental income being the main attraction to Hong Kong investors.
As you would expect, those aged 55 and over were the most likely to invest, with a substantial 89% holding investment assets. There were a surprisingly high number of 18-24-year olds however, 58% of which were holding investment assets, with many of these investments were held internationally.
What is surprising is that this demographic was unlikely to invest in their own country of residence, with only 9% saying they would consider internal investment. When compared to the UAE at 24% for internal investment, the appeal of inward investment is clearly suffering in Hong Kong.
With property prices continuing to rise in the region, this trend of international investment is showing no signs of slowing for Hong Kong residents, suggesting UAE investors will join an already high level of investment from the Asian mainstay.