Sales of premier residential properties in Hong Kong rose 8 percent in 2018 to hit a record $24.6 billion as more foreigners and Chinese locals look to the city for new homes.
According to Centaline Property Agency, the number of sold houses that are worth more than HK$20 million ($2.55 million) passed the 4,000 marks to hit 4,189. In terms of the combined value of these sales, the same report said that the total was up 14.8 percent compared to 2017 to reach HK$192.67 billion. Among the many wealthy areas in the city, Fleur Pavilia in North Point appeared to be the most preferred, with the number of homes sold reaching 380 for a total sale price of HK$9.59 billion, writes the South China Morning Post.
Just recently, the largest developer in Hong Kong, Sun Hung Kai Properties, paid for a prime spot of residential land located at an old airport runway in Kai Tak for HK$11.26 billion. This amount is below the HK$20 million marks to be classified as luxury, but the market can expect this area to be converted into prime space very soon. In fact, the developer is prepared to spend HK$20 billion on this project, which observers say could have the area priced at HK$30,000 per square foot once completed.
Market analysts say it remains to be seen whether the same level of luxury home sales will happen in 2019, especially as the China-US trade war continues unresolved. If the tensions do manage to end this year, more capital from the Mainland is expected to pour into Hong Kong, which will then drive personal wealth up and property investments higher, as well. Conversely, the Mainland's economy will certainly take a huge hit and result in a decline in real estate investment inflows.
The Centaline study comes at almost the same as Demographia's annual list of least affordable cities in the world, which Hong Kong topped for the ninth year. It is estimated that the average price of Hong Kong properties is HK22,718 per square foot.
