RealMoney

Brexit doesn't translate very well into Chinese, it seems. 

Britain's decision one month ago to leave the European Union has left Chinese real-estate buyers confused, according to a survey by East-West Property Advisors. The company, a platform for brokers and developers to market their product in China, asked 700 clients and property professionals in China and Hong Kong whether they are now more or less interested in both U.K. and U.S. real estate.

The responses show that 39% of Chinese buyers are now more interested in investing in houses in the United Kingdom. But 32% have been put off. The verdict is clearer in the United States, where 41% of respondents are now increasing their efforts. 

"People are very confused about the entire story," East-West Property co-founder and director Sam Van Horebeek said in an interview with Real Money. "There's no pitch to say, 'Oh yeah, this is a great opportunity and everyone should buy in the U.K.,' although that's what brokers are saying."

That one-third of Chinese property shoppers are deterred makes sense to van Horebeek. "They are reasonable people and they have reasonable questions about the U.K. future," he said. "People are waiting a little to see what the implications are."

But the answer to that is far from clear. New U.K. Prime Minister Theresa May this week told her German counterpart Angela Merkel that there would be no progress at all on Brexit for the remainder of this year. The Bank of England is also more inclined to cut interest rates than raise them, meaning there's little likelihood of rapid currency appreciation. So it's not like there's any huge rush to jump in.

East-West Property agrees. It seems the Brexit camp almost didn't expect to win. "There's a lack of a plan or a vision, except leaving the European Union," Van Horebeek said. "That's not good for any property market in the U.K., [nor is it good for] the stock market."

There has been a flood of news stories on Brexit and its impact on real estate, with some articles arguing that this is great news for buyers trying to get into the United Kingdom. But there is an equal number of stories arguing that buyers will turn elsewhere in the uncertainty, with the United States and Australia major beneficiaries.

To illustrate the polarization, a separate survey by Juwai.com found that Chinese buyers are more interested in U.K. property than before the Jun. 23 vote. The portal, which, like East-West Property, markets international real estate to Chinese buyers, has seen a 40% increase in inquiries about British property.

"The Chinese are very, very interested in the U.K., and post-Brexit we're seeing that demand increase," CEO Charles Pittar said on BBC World. They had held off prior to the vote, he said, but the number of leads generated since the decision to leave the European Union has already outdone the level of interest for the entire rest of the year.

One explanation for this confusion is that it takes time to buy real estate, with buyers needing to research the market -- many also visiting any location where they might buy. Even once all the due diligence is done, it takes two or three months to complete a sale. 

The commercial property brokerage DTZ/Cushman & Wakefield has said that Chinese buyers would break into three camps, as I explained near the start of this month. Opportunistic investors -- such as the insurer Ping An, which already owns City of London real estate such as the Lloyd's building -- may now find yields so attractive that they will re-enter a market that had priced itself out. But other Chinese buyers will sit on the sidelines, Cushman said, and others will feel the whole situation is too risky and turn their attention to other markets.

Chinese money flowing into U.K. properties fell last year, to $2.2 billion in 2015, down from $3.8 billion in 2014, figures from Real Capital Analytics show.

LaSalle Investment Management, the asset-management affiliate of Cushman competitor Jones Lang LaSalle  (JLL) , believes Brexit implications will be short-term and less severe than many investors fear. Its mid-year investment-strategy report said any property correction over the next 18 months will be largely restricted to the United Kingdom. Investors working in U.S. dollars and Japanese yen should find this an opportune time to enter the U.K. market, the review states.

The "law of unintended consequences" means investors must watch for ripple effects in the European Union, North America and even Asia, according to Jacques Gordon, LaSalle's global head of research and strategy. But a "triple low" of poor growth prospects, very low or even negative interest rates, and scant inflation expectations still mean real estate is one of the most-attractive investment plays right now, LaSalle said.