Hong Kong Apartments for Rent at Lower Rates Due to Border Hope

Posted on 11 July, 2021 | By Property852

Imminent reopening of the mainland and Hong Kong border, in conjunction with an environment of continuing low interest rates, has spurred rising bank valuations for Hong Kong apartments. Of the twenty housing index estates, the latest valuations have seen increases in seventeen, which accounts for 85% of the total. The increases ranged from 0.6% to 6.8%. Valuations of the remaining three estates were flat, but no declines were recorded, indicating that banks are taking a more aggressive position. According to The Rating and Valuation Department, there has been an increase for five months consecutively in the private domestic price index, showing increases of 3.6% cumulatively. The most recent index has rebounded to the June 2019 level, showing the market has risen from the pandemic haze. The standout performer of the estates was Kingswood Villas, located in Tin Shui Wai. Executive Director, Ming Tse, of Many Wells Property, stated that New Territories west properties currently have the lowest average price along with Tuen Ma line. As a result, savvy buyers are seizing the market opportunity and have pushed the prices for Kingswood Villas small-sized units over the HK$6million mark. Furthermore, for Wetland Seasons Park, occupancy readiness and infrastructure facilities development have increased potential for residential buildings in the district to realize price appreciation. Tse predicts valuations will continue their rise this month.

Chief Operating Officer and Director of Kowloon at Hong Kong Property, Dave Ma Tai-yeung, stated that the continuing low interest rates and the opening of Tuen Ma Line have boosted the Hong Kong property market. He noted that Hong Kong’s unemployment rate has dropped to 6% as the pandemic's seriousness has eased, and has been decreasing over the past three months.

Hong Kong Apartments for Rent

The Hong Kong apartment market has seen a large influx of capital and, in the short term, prices are expected to peak. However, Ma also predicts prices for the entire year rising by 15%. There’s also still room for an upward trend after the latest valuation rise. Ma also indicated that not too many high-quality units had been placed on the Hong Kong Island market, resulting in lower increases in valuations. Ma’s expectation is that those units will eventually catch up pricewise. For example, at Crestwood Court, Kingswood Villas, a 458-square foot unit valued in May at HK$4.69 million, had a HK$5.01 million valuation last month, an increase of over 6.8%, the highest for two consecutive months among the major housing estates. Also performing well was Telford Gardens, which had an estimated valuation of HK$7.07 million for a 493-square foot unit last month, an increase of close to 5.7% over its May valuation of HK$6.69 million.

At Nan Fung Plaza, a rise of more than 4.5% was seen with a 697-square foot unit, previously estimated at HK$8.83 million as of May, hitting HK$9.23 million in June. Chief Executive of Ricacorp, Willy Liu Wai-keung, indicated that units less than HK$10 million saw popularity with first-time home buyers. He pointed to a recent record-breaking transaction at Kingswood Villas, Telford Gardens benefiting from new properties launching in Kai Tak, as well as Nan Fung Plaza’s low-priced unit sales rising. He noted that secondary market transactions were active, driving up unit prices overall.

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