Hong Kong Property Prices and Park Island Property Price head towards new historical highs

Based on the latest Hong Kong property data Centadata property price graph Hong Kong property prices continued their upward climb, heading towards all time historical highs.

Hong Kong Property Price Graph Nov 2016

Park Island apartment prices rose over 6% last week and are now also again approaching historical highs.

Park Island Property Price Graph Nov 2016
It is very obvious that were not for the recent additional "cooling measures" implemented 5 November 2016 (see New HK Stamp duty for property) prices would have reached absolute new highs by end of 2016. 

It now remains to be see what effect the recent cooling measures, as well as the effect of the election of Donald Trump on HK Property. As I have explained in prior posts, from a valuation perspective, I would look at HK property as incorporating the value of every type of cooling measure, which will be "realized" on any eventual reduction of such measures.

I would expect to see somewhat of a short term dip in prices as the latest round of cooling measures take effect, but who knows, sometimes playing with the market can have unintended consequences, one of which is that money will flow to property which represent better value and/or are still relatively affordable by first home buyers (and clearly Park Island is in that category).

Finally, again related to the Trump effect, almost all currencies in Asia have fallen sharply to the HKD. So to the extent anyone who is a HK property owner doing a HKD value comparison, you will you have made significant amounts of money if you where to convert the value of your HK apartment to a non-HKD currency. Great for anyone from HK looking to sell up and move overseas, for example to Thailand or Malaysia.

Comments

  1. Well like I said a while back one would have to be very foolish to had sold a year or go when it seemed like things peaked. Costs way more to rent then to pay mortgage on a loan and prices keep going up.

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  2. And like I have said before, this comment about "anyone selling is foolish" is also a little unfair (I have seen this on prior comments section so I presume its the same person).

    Each person selling may have their own reasons. A person who sold a year ago might have put their money into stocks and done very well out of it. Maybe they are selling to move to somewhere to live the good life - Australia, Thailand, etc where for a HK apartment one can buy a much larger place. Maybe they have made a lifestyle change, or lost their jobs and needed security in the money from a sale.

    Having said that, I do think Park Island is a good long term investment. I personally would be buying now, not selling as the rental income is way higher then the cost of a mortgage - a clear sign that the underlying price to purchase is undervalued.

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  3. How would the new developments at Disney Park in Hong Kong affect the prices on Park Island?

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  4. Yes so prices are on their way back up again. I am new to HK but if I speck to any HK person, they will always say prices will keep going up. Its for a few reasons. Chinese and HK people love property. This is where they will put their money as everyone wants a nice apartment and space is so tight. Secodly it is very cheap to borrow in HK and also to buy and sell is very common and fluid. Third Chinese buyers are coming here also.

    I will buy a property in HK and most likely Park Island just because the quality is so high and I like to live here. If prices keep shooting up as China grows then that is also great once I am an owner of one.

    ReplyDelete

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