Landlords will face ‘intense competition for tenants’ in some Hong Kong districts, as the increased supply of new apartments leads to a glut. Real-estate agent Rocky Wong warns that a 194-square-foot unit ‘may just go for about HK$10,000 a month’. Some experts see more micro-flats flooding the market; others say the effect will be temporary and ‘normal’ rents will soon return.
The SCMP does not mention the all-important matter of rental yields. Average prices for these units seem to be around HK$3.8mn, suggesting a yield of 3%, which is lower than (to take some boring examples) Hang Seng Bank or Cheung Kong Holdings pay out – plus you don’t have to mend their leaky bathroom taps.
But presumably, many of these nano-flat buyers don’t have cash. Such barely habitable developments are aimed at the classic Hong Kong must-have-property-at-all-costs bubble-chasing herd, who are relying on oh-so-tempting (developer-arranged) financing deals. What will they be paying in mortgage interest further ahead? Did they stop to ask themselves that at any stage? (Hang Seng Bank and Cheung Kong no doubt did.)
Meanwhile, up the road, banks are issuing 1 million credit cards every 4.5 days as urban households borrow to buy housing. Thanks to rising property valuations, this is on average almost doubling their annual incomes – on paper. (I didn’t know they could print credit cards that quickly.)
Its that time of the year again. DAB legislators finally released from their rubber stamping duties are on the prowl.
Looking up under our skirts, prowling rat infested alleyways and fishing turds from our swimming pools, all well trodden paths of mind numbing predictability. The pool extras no doubt deposited by visitors enjoying a cheap holiday at our tax funded facilities.
Luckily this interest in local affairs is short lived as they will be inking the pads up soon for the next Legco year.
That the only model back alley in TST happens to be that behind my home is of course mere coincidence and certainly no thanks to the local DC.