1 March 2016 - To assess the commonly asked question of “How is the property market performing?” OKAY.com property agent,
Robert Diefendorf, proposed the idea of viewing Hong Kong’s property market as a collection of micromarkets rather than a single monolithic one.
In an article that appeared in SCMP on 24 February 2016, Robert highlighted several cases that show micromarkets are influenced by their own trends, news and market forces. Investors take these factors into account when evaluating where to buy, with some aiming to flip properties by spotting “under market flats” ahead of new infrastructure projects.
Some examples include:
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Tung Chung – new infrastructure, the longest sea bridge in the world and a second MTR stop have made this “New Town” a magnet for young families and retirees seeking a quieter lifestyle.
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Sai Ying Pun – bistros, wine shops and art galleries continue to replace local storefront diners and car repair shops alongside the development of the Western MTR line and well-positioned escalator. Accompanying this is the gradual gentrification of old residential blocks.
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Wan Chai – pockets within this district can be classified as their own micromarkets, namely “Star Street” with its lower density, leafy surroundings. Apartments in this area are able to demand higher prices which have been maintained despite the recent influx in supply resulting from new nearby development, The Avenue.
Hong Kong is a strong real estate market and Robert cites these “new trends and forces that most cities have not had for over a century” as the reason we are not experiencing a much reported property bubble. OKAY.com’s CEO,
Joshua Miller, suggests that the current return of buyers to the market
reflects a pent-up demand for buying opportunities. “In the first six weeks of 2016, we’ve completed over 50 per cent as many sales transactions as during the entire 2015.” Although the short term impetus for buyers may be a softening of price points, the long term confidence is due to the underlying and unique fundamentals present in the market.
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