Hong Kong has been shaken by protests and a pandemic that has almost isolated the city from the world, but high-end real estate transactions are booming, driven by mainland entrepreneurs.
This week, billionaire Wu Yusen’s real estate group Wheelock sold two apartments on Hong Kong’s famous hilltop for HK$1.2 billion (US$154 million), setting a record price per square foot in Asia. The sale follows another transaction in which the real estate group Wharf Holdings rents out luxury homes at a price of HK$1.35 per month, another record in the city.
Although Hong Kong faces a series of challenges and questions its prospects as an international financial center, real estate transactions are still going on.
Beijing repressed the city by implementing strict national security laws to restrict dissidents after the 2019 democracy protests.
These changes, combined with some of the most stringent pandemic border restrictions in the world, imposed a three-week mandatory quarantine on anyone visiting the city, causing many residents to leave. The number of residents in Hong Kong fell by 1.2% in the first half of this year, which was the third consecutive decline in six months after more than a decade of growth.
However, due to a long-term lack of land, residential prices have remained stable, partly due to the hoarding of land by real estate developers and policy errors.
Henderson Land Development, a real estate group controlled by one of Asia’s richest man Lee Shau Kee, said this month that it would spend 63 billion Hong Kong dollars in a record 50-year tender to develop a waterfront plot in central Hong Kong.
“If you think about the challenges Hong Kong has faced in the past two years, from Sino-US tensions to social unrest to the pandemic, but it turns out that the residential market is very resilient, we continue to see transactions with real estate company Savills. Simon Smith, head of Asia-Pacific research, said. “The market here always seems to be foolproof. “
Nelson Wong, head of research for Greater China at the commercial real estate company Jones Lang LaSalle Hong Kong, said the housing shortage has offset the impact of the population decline.
He said: “The existing housing still does not adequately address the housing demand.”
Wong added that the number of residential transactions of more than HK$100 million was higher than in 2018.
The identity of the buyers of the Peak Apartments has not been disclosed, but Smith said that the high-end market is increasingly being boosted by mainland entrepreneurs. Many of them conduct business on the South China border, but want to live in Hong Kong.