Hong Kong home rents inch towards record high on Chinese demand
A steady inflow of mainlanders is bolstering rents in pockets of Hong Kong, with North Point jumping 8.8 per cent compared with a year ago due to its convenience in location.
On average, asking rents in July were up 1.1 per cent from the previous month, close to a historic high, according to online property listing platform Spacious.hk. Rents are now just 2.2 per cent below their peak in 2019, and on track to reach a record in two months, the firm estimates.
A 570-square-feet (53 square metres) one-bedroom in North Point's relatively new development Fleur Pavilia is asking for HK$32,000 (S$5,243) per month, a listing shows.
'Rents will likely continue rising mainly because demand is strong,' said Simon Fan, a realtor with Centaline. 'When mainland Chinese clients come to Hong Kong, they still wait before buying, so they rent instead.'
Mid-Levels West has seen rents increase about 10 per cent in the past year, largely underpinned by Chinese professionals and students who like the area's proximity to the business district and the University of Hong Kong, Fan added.
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The financial hub has approved about 340,000 applicants for work visa programmes aimed at expanding the labour force. More than 220,000 have arrived in the city, according to government data.
Hong Kong previously saw an exodus of expatriates during the pandemic due to the government's strict quarantine measures. The decline among this population segment continues to weigh on rents in areas popular with foreigners. Deep Water Bay dropped 17.2 per cent in July compared with a year earlier.
In terms of volume, Centaline recorded nearly 2,000 leasing transactions in the first four weeks of July, a jump of 30 per cent from the month before.
Some landlords in popular neighbourhoods are leveraging the opportunity to hike rents. Abi Zhang and her roommates were told in June that they would have to pay 20 per cent more, two months before the end of their current lease. The 27-year-old financial professional found it unacceptable and moved out of the property in Kai Tak, an area favoured by middle-class mainland immigrants. BLOOMBERG
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