HONG KONG: Hong Kongers moving abroad have bought at least US$100 million worth of property since 2019, a year marked by unprecedented social unrest, according to a Hong Kong-based law firm.
The Harvey Law Group (HLG) found that Hong Kongers' preferred destinations are the United States, United Kingdom, Australia, New Zealand and Canada. Their interest in finding a residency overseas or a scheme that paves the way to citizenship through investment has increased fourfold in the last two years.
"From our clients worldwide, since 2019, they have bought about US$1 billion worth of properties under various residency or citizenship-by-investment programmes, and Hong Kong contributed about 10% of that," said Jean-Francois Harvey, global managing partner and founder of the firm. Since 1992, HLG, which has 18 offices worldwide, has served about 12,000 clients and families who sought mobility via residency or citizenship schemes.
"This demand had been sustained. Pre-1997 we had a small wave of Hong Kongers, but in 2019 we had a perfect storm, and easily there was fourfold growth," he said. Each time the city faced a political crisis, there was a marked uptick in inquiries.
The type of person seeking a second passport or a residency abroad has shifted over the years too.
"The profile has changed a lot. Before 2019, a typical Hong Kong client would be in their 50s with kids aged in their late teens. Now, we're looking at young 40s with kids between two and seven years old," Harvey said.
"Before 2019, Hong Kong was never a passport market, because the Hong Kong passport is quite convenient to travel with, but lately we've seen a very big increase in the number of people asking for a new passport and to acquire new citizenship because they want security."
The alternative passport option became more popular still after Beijing imposed a sweeping national security law seen by many as an erosion of Hong Kong's autonomy and the freedoms afforded its citizens under the Sino-British treaty.
The various residency and citizenship schemes on offer have boosted the housing markets of destination countries, as buying property is typically one of the ways to gain permission to stay in a country.
"There are many benefits to the host country, including to the property market. In fact, since the outbreak of the pandemic, many more countries have been designing and setting up residence and citizenship-by-investment programmes to attract affluent investors and talent," said Denise Ng, head of North Asia at Henley & Partners.
For Hong Kongers, the top residency programmes are those offered by Thailand, the UK and Canada, while for citizenship, the preferred schemes are in Malta, Grenada and Dominica, according to the immigration consultancy.
"For international investors, wealthy families and entrepreneurs based in Hong Kong, citizenship diversification through investment migration will continue to be a robust solution to navigating ever changing circumstances. [It is] a win-win for sovereign states and investors alike."
It is estimated that about 50,000 Hong Kongers chose to leave the city in 2020, though this year the number is likely to decline by 4.6%, according to UK-based Astons, which helps clients buy real estate and obtain residency and citizenship via investment.
"For many Hong Kongers, emigration is being considered with a long-term view and so the real estate component of residency or citizenship through investment can be particularly preferable," said Arthur Sarkisian, managing director at Astons.
"It provides a tangible asset that can bring a further return on their investment in addition to residency or citizenship. Or, in the case of the residential path, it can provide them with the firm foundation of a home when starting their new life."