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$1 trillion of Chinese Capital Poured into Overseas Property

Chinese investors seeking to balance their portfolios were responsible for $1.03 trillion of capital outflow into foreign property according to a new report.

Chinese Overseas Property Investment

Chinese investors seeking to balance their portfolios were responsible for $1.03 trillion of capital outflow into foreign property according to a new report.

Despite efforts to restrict overseas mortgages and other exchange services to Chinese nationals from international governments and banks, Chinese investment over the last decade into foreign property markets has raised exponentially – culminating to $1.03 trillion in mid-2015 – shows Knight Frank’s new annual Wealth Review.


Chinese investors are looking to invest in international infrastructure as a means to diversify their investments from fear of a cooling domestic economy explained head of global research at Knight Frank, Liam Bailey in regard to these figures.


Commenting on the challenges the Chinese government faces when dealing with similar volumes of capital outflow, Bailey suggested it is a matter of ‘balance’ between their need to control Chinese investment overseas against the trade of assets at a non-corresponding price or “price bubbles” within China.


Chinese investors’ quest to balance their portfolios and diversify their wealth can be beneficial in taking pressure off their own domestic property markets as well as international markets such as the UKs, which suffers from chronic undersupply.


Attracted to the stability offered by a regulated property market, as well as growing transport infrastructure, Chinese investors are encouraged to pour a significant amount of their capital into UK property.


Market analysts predict that China’s 12-digit capital outflow into foreign property is likely to rise in the coming years. Indeed, the end of 2015 saw a record investment into UK property from Chinese investors which is expected to reach £105 billion over the next decade according to a new Pinsent Mason report.

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