China’s ‘three red lines’ could cause London property ‘crisis’

Beijing’s “three red lines” could cause a “crisis” for London property if China restricts real estate investment overseas. As a second developer, Fantasia, joins Evergrande in defaulting on an offshore bond, concerns have risen that a crackdown on excessive leverage could end Chinese developers’ interest in the capital. One property consultant close to London’s development market was contacted in the wake of the Evergrande crisis by a UK regulator with concerns about the risks of contagion in London. “The big question is whether the Chinese will restrict investment overseas,” he said. “That would be a pretty big crisis in the UK and elsewhere.” The FT (£)