Now that Hong Kong is a special administrative region of China, its star is rising as fast as China’s, and the entire real estate industry in Hong Kong is benefiting.
Hong Kong’s physical geographic restrictions mean that there is a limited supply of residential and commercial real estate available for sale and rental; and as Hong Kong strengthens its already strong economic, trade and investment ties with China, demand for real estate in the region is intensifying.
Multinational companies and their huge base of expatriate employees, local businesses and local residents, tourists and students compete for space. In fact, demand for residential and commercial space in Hong Kong is at its highest today since the glory days before 1998. After suffering a sharp recession from 1998 to 2003, property prices are for sale at deflated costs and are therefore considered undervalued, meaning that the real estate market is currently in an excellent position to grow and expand.
Because the real estate demand in Hong Kong is so intense…
Because Hong Kong’s economy is getting better and better…
Because national purchasing power is so strong…
And because the real estate market is believed to be currently undervalued, the wealth of profit opportunities in the Hong Kong real estate market is currently intense.
Real estate investors around the world are buying into the projected growth period and committing substantial funds to the Hong Kong market. In terms of restrictions on foreign investors, there are none in Hong Kong…in theory anyone is allowed to buy property. As with all city-based real estate economies, property in Hong Kong – while currently considered undervalued – cannot be considered “cheap”. However, anyone wishing to enter the market can obtain mortgages locally in Hong Kong and can almost guarantee the rental income they will generate if they choose to buy residential or commercial units for rent.
The medium-term outlook for the property market in Hong Kong is good, with analysis showing that the number of renovation projects and new developments launched in recent years is below what is required for the current level of demand. This insufficient supply will last at least the next four years according to the analysis of industry experts. This has resulted in house price growth forecasts of up to 12% per year for at least the next four years, making the real estate market in Hong Kong today a very attractive prospect.