The Real Estate Market in Hong Kong Today
Now Hong Kong is a Special Administrative Region of China its star is rising as fast as China’s and the entire real estate sector in Hong Kong is benefiting. The physical geographic restrictions of Hong Kong mean that there is a finite supply of residential and commercial real estate available for sale and rent; and as Hong Kong further strengthens its already robust economic, trade and investment ties with China, the demand for real estate in the region is intensifying. Competing for space are multinational companies and their massive expatriate employee base, local businesses and local residents, tourists and students. In fact the demand for residential and commercial space in Hong Kong is at its highest today since the glory days pre-1998. Having suffered an acute recession from 1998 until 2003 real estate prices are for sale at deflated costs and are therefore seen as being undervalued which means the real estate market is in a great position right now to grow and expand. Because demand for real estate in Hong Kong is so intense… Because Hong Kong’s economy is going from strength to strength… Because domestic purchasing power is so strong… And because the real estate market is believed to be currently undervalued - the wealth of opportunity for profit in Hong Kong’s property market right now is intense.
Real estate investors from around the world are buying into the projected period of growth and are committing substantial funds to the Hong Kong market. In terms of any restrictions placed on foreign investors there are none in Hong Kong…in theory anyone is permitted to purchase property. As with all city based real estate economies property in Hong Kong - though currently considered to be undervalued – cannot be regarded as ‘cheap’. However anyone who wishes to get into the market can get mortgages locally in Hong Kong to purchase and can almost guarantee the rental income they will generate if they choose to buy residential or commercial units to let. The medium term prospects for the real estate market in Hong Kong are good with analysis showing that the number of renovation and new development projects started in recent years is below what is required for the current level of demand.
This undersupply will last for at least the next four years according to expert industry analysis. This has resulted in predictions for property price growth of up to 12% annually for at least the next four years, making the real estate market in Hong Kong today a highly attractive prospect.
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