Hong kong Property Market
If you want to be a player in the Hong Kong property market, you’d best read what follows carefully, because it’s one crazy game. Here’s the first problem: property in Hong Kong is grossly expensive. That’s fine, you say — once you can afford some, it’ll appreciate in value, and you’ll have a nice safe fat investment on your lucre-dripping hands. Well, maybe in normal places, but not here. First off, we’ve got this little property market crash/recession problem going. This too shall pass — we hope — but the days of buying a flat for HKD500,000 and selling it ten years later for 5 million are gone, and simply won’t be back. Here’s the next problem: even if your property eventually appreciates in value, you’d better not get too attached to it, because once it’s old enough for the paint to be fully dry people are going to start turning their noses up at the very thought of buying it. This is a unique — and intensely irritating — feature of the Hong Kong market. In other places, people often ask ‘How old is this building?’ as an aside, finding it charming or even value-enhancing to know they’d be living in an art-deco era apartment tower, or a sturdy nineteenth-century brick house, or even a 400-year-old stone cottage, as you might find in the UK. But here, a block of flats that’s 10 years old is already suspect, and many potential buyers won’t even set foot in a flat that’s 20 years old or more. ‘How old is it’ is just about the first question many buyers consider, and becomes the primary criterion for winnowing through properties for sale. This is a handy tool when you’re buying, but its common usage becomes increasingly disturbing as one owns and occupies a Hong Kong flat. We Hong Kong homeowners have to ask ourselves: how long can I hope to live in my flat before no one will ever want to buy it if I decide to move? As if these problems weren’t enough, we’ve now got to consider the Hong Kong Government’s price-fixing strategies. What?! — you exclaim — isn’t Hong Kong the bastion of the free market, the world center of laissez-faire capitalism? Well, yes, but there are a few exceptions. The Government here has a two-handed stranglehold on the property market. First, it owns nearly all of the land that could conceivably be built upon. It can, at its whim, release parcels of that land for sale, thereby affecting the market directly. In addition, the Government supplies huge numbers of public-housing flats for rent, and also sells highly subsidized properties as well. This is great if you qualify to live in or buy one of these flats (the Byzantine regulations controlling access to these privileges are too depressing and complex to get into here) but if you own a lower-cost flat (as Mr and Mrs Tall do), and the Government suddenly undercuts the market by flooding it with similarly-priced but newer flats, what can you do but grin and share the joy of your fellow Hong Kong citizens who are in buying mode? So: is there any way to win at the Hong Kong property game, you ask? Yes, I can assure you there is. My wife and I have just bought a new flat, in a brand-new building - so new, in fact, that it’s not even close to being done yet. If all goes well, and the building is indeed completed more or less to plan, the word is that our pre-purchased property will immediately appreciate in value upon its completion (i.e. because an existing property is de facto worth more than a brochure and a mock-up). So, if you want to make money in the Hong Kong property market, you can simply follow these easy steps: 1 Buy a flat that doesn’t yet exist. 2 Wait until it does. 3 Sell it immediately. What? There’s a problem with this plan? Oh, yes - someplace to actually live. You can’t rent, of course, because that would eat up your profits. Fortunately, Hong Kong is liberally blessed with flyovers, so I’ll see you in one of those cozy nooks beneath them! Hong Kong Property sales
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