BUYERS from Hong Kong could snap up as many as 10,000 units of properties in Malaysia as antigovernment protests have brought China’s special administrative region into a gridlock and rioting which has turned violent in recent weeks.

Police had fired rubber bullets at rioters who had used petrol bombs and other homemade weapons.

The over six-month protests had crippled Asia’s key financial centre and dragged the China-ruled territory into a recession. Hong Kong citizens have been scouting to purchase properties abroad to escape the mayhem as they predict the situation would worsen as Beijing will tighten its grip on the territory including sending the military.

VPC Realtors (JB) Sdn Bhd Asia-Pacific property consultant Bruce Lee predicts the number of units purchased by Hong Kong buyers will reach 10,000 in the next six months if the anti-government protest continues.

“Hong Kong buyers have been coming in batches to buy the property in Malaysia. They come quietly every weekend and buy around 50 to 100 homes per batch.

“They have acquired more than 1,000 units in overall Malaysia to date,” Lee told The Malaysian Reserve (TMR).

In August, TMR reported that Hong Kong buyers have purchased 500 Malaysian properties since June. Taking an average price of RM1 million per properties, the 10,000 units could be valued at RM10 billion.

Lee said the influx of buyers from Hong Kong will help ease at least 10% of the total overhang units in Malaysia.

Malaysia offers a cheaper alternative than properties in Singapore. The cultural similarities would also ease the Hong Kongers assimilation into the country, which has about 25% Chinese from the total 32 million populations.

Local developers have been actively organising sales pitches in Hong Kong in the last few months to woo buyers from the region.

Lee also has not ruled out that Hong Kong’s commercial property market will collapse if the antigovernment protests prolongs.

“Recently, the transacted prices of commercial property have already dropped 50% (in Hong Kong). The whole market is scared as the property prices will face deficit in value.

“After the crash of property prices, Hong Kong economy will be impacted and it will face a slow growth,” Lee said.

But he said the residential market will continue to be strong as the supply of homes in Hong Kong can never meet the demand.

Lee said currently, the residential property prices in Hong Kong might not increase, but they will not plunge.

On the interests of foreign buyers following the revision of the threshold, Lee said presently, there is no spike in inquiries.

“The lower threshold does not have a big impact because policies are not the main issue here. Unless the demand and supply achieve equilibrium, we will not be able to attract many foreign buyers,” he added.

Juwai.com executive chairman Georg Chmiel said Malaysia was the fifth-most popular country for Chinese property buying inquiries in the world in the first half of 2019.

“By total Chinese property investment in value, Malaysia ranks lower. In the Asia Pacific, Thailand, Japan and Australia all rank ahead of Malaysia as the three most popular destinations for Chinese buyers. Canada is fourth in the global ranking.

“Chinese made 16.5% more inquiries on Malaysian property in the third quarter (3Q) than in the same quarter of 2018. Buying inquiries have declined from their peak in the 1Q, but remain above the average level of 2018,” he said in a recent statement.

He added that Malaysia is especially appealing to buyers motivated either by lifestyle, retirement or education.

Chmiel said the country has affordable standards of living, high quality of life, and medical facilities, and accessible educational institutions.

According to a recent economics report by Juwai.com and Malaysian real estate agency network IQI Global, mainland Chinese buyers accounted for RM8.4 billion (US$2 billion) of Malaysia’s total residential property sales.

The report noted that mainland Chinese buyers accounted for 12.1% of the total transaction value, but only 0.4% of the total transaction share in 2018.