HK Luxury Apartment Rents Fall 30%



ORIGINAL POST

Posted by Ed 5 mths ago
AsiaXPAT (Hong Kong) -  HK Luxury Residential Property Rents Fall up to 30%  
 
The Hong Kong luxury property market has corrected dramatically as both expatriates and mainland Chinese avoid HK due to the ongoing protests.   The economic downturn in China is also affecting the property market as fewer expats are being hired in the finance and other high-paying industries.
 
One agent indicated that a 3000s.f. townhouse on the HK Peak had seen a 30% reduction in the asking rent over the past few months with the target rent now HKD150,000 to 200,000 per month.     
 
Leasing activity for premium properties has crashed by over one-third with no end in sight.
 
Mainland Chinese have been the target of protesters and an attack on a Chinese private banker at JP Morgan by an enraged crowd of black-shirted protesters has circulated on social media in China creating fear of visiting or moving to HK.    Many mainland Chinese in Hong Kong are considering leaving the city due to these concerns which would put further downwards pressure on HK rental rates.
 
A fall in IPO's and other financial deals in Hong Kong has reduced the need to hire highly paid professionals from overseas and has also resulted in some financial and law firms reducing headcounts in their Hong Kong offices.   Read More on this topic.

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COMMENTS

Ed 36 days ago
AsiaXPAT (Hong Kong) -  Rent Prices for Luxury HK Flats Continue to Fall - Occupancy Rates in HK Serviced Apartments Falling
 
The never-ending trade war between China and the United States as well as the simmering HK protests and economic downturn in both China and globally continue to negative impact the Hong Kong residential property market.
 
Hong Kong is mired in a deep recession with protesters continuing to target shopping malls and drive away tourists from the mainland and overseas.
 
Savills reported that rent reductions were most severe in the New Territories (-3.6%), Kowloon (-3.1%) with HK Island faring better (-1.6%).  Rents have dropped across all areas of Hong Kong for two consecutive quarters now.
 
Sai Kung was the hardest hit with rents falling nearly 5%. 
 
Big-budget mainland China tenants continues to lag as Chinese continue to avoid Hong Kong due to fear of attacks by radical HK protesters. 
 
Serviced apartments are also taking a hit as occupancies have dropped well below the norms of 80% while hotel occupancy rates had plummeted to 60% in September.   Hotels are competing with serviced apartments by offering very competitive long-stay rates. 
 
For the full Savills HK report click here  

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Ed 33 days ago

AsiaXPAT (Hong Kong) - The Major Property Investors are Leaving the Building

CBRE HK reports that tycoons, high-net worth individuals, and family investment offices are shifting significant dollars out of Hong Kong property into other countries including Britain and Australia.

Steep declines in both prices and rents in HK are fuelling the move as investors are clearly losing confidence in the city's real estate market.

With many property agencies predicting further drops of up to 20% in residential and perhaps 40% in commercial property prices in Hong Kong in 2020, investors are heading for the exits in droves.

The HK property market is experiencing 'perfect storm' conditions as the ongoing trade war and declining growth in China are hurting prices, compounded by the often violent protests gripping the city and driving away mainland property speculators and end-users.

The government and HK protesters remain at loggerheads with the protests simmering then flaring up as if to remind investors that the situation remains unresolved and volatile.

The HK economy remains mired in recession as tourists avoid the city like the plague, and businesses take a wait and see look with respect to hiring new staff and expansion. A number of high profile retailers including Louis Vuitton have closed retail shops in HK in recent months.

The exodus of funds to other property markets will put additional downwards pressure on HK property prices in 2020 as investors dump their HK real estate holdings into a market where demand is already waning.

Read more on this topic on the SCMP.


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