1.

Residential property prices in Hong Kong have been increasing. Demand for leased premises have also been increasing due to the strong economic growth prospects in the region. Hong Kong’s residential capital values rose in Q1 2010 with an increase of 8.1% compared to a quarterly increase of 6.9% at the end of last year. Due to expectations of further increases, it is expected that interest rates and required reserve ratios of banks will be raised to curb inflation and property prices.

2.

Hong Kong’s supply forecast for 2010 and 2011 rose from the record low of about 7,200 units in 2009 to 14,260 units in 2010 and 10,960 units in 2011. Due to the high liquidity of Hong Kong’s banking sector, consumers have access to mortgages at interest rates below 1%, making property investment highly attractive.

3.

Average rental growth has declined from 13% to 4% quarter-on-quarter in Q2 of 2011. However, it is expected that upgrading and expansion demand will increase average rents by up to 15% in the coming year.

4.

In February 2011, Hong Kong experienced a 30% month-on-month rise in average home prices, with a total of 10,390 sales and purchase agreements, a total cost of HK$45.6 billion (US$5.9 billion) and a 12% jump on an annual basis, which favorably adds to Hong Kong’s property market outlook.

5.

Individual top-tier buildings in the Central area are expected to see slowing growth, however, increased demand spillover from Central is expected to benefit surrounding business districts including Wanchai and Causeway Bay.

6.

Hong Kong has the most expensive rentals in Asia according to the Rating and Valuation Department of Hong Kong.

7.

According to Jones Lang LaSalle’s 2010 Global Real Estate Transparency Index, Hong Kong's real estate market is the 18th least corrupt in the world. The level of transparency in a market is important to consider when investing in foreign real estate markets.

8.

The Urban Land Institute and PricewaterhouseCoopers (PwC) put the Hong Kong third among the top Asia Pacific cities to invest in its 2010 report of Emerging Trends in Real Estate in Asia Pacific.

9.

Hong Kong's vibrant city and nightlife is attractive for many foreigners as a place in Asia to live and work, hence making Hong Kong real estate and migration to Hong Kong popular for global investors. Hong Kong is at a 90.9 out of 100 in the Economist Intelligence Unit livability survey.

10.

Hong Kong is considered to have the most favourable tax regime of any global city, according to a 2011 Savills report. As such, many international companies have made Hong Kong their headquarters, contributing to relatively consistent demand for Hong Kong commercial property. There are no restrictions on any individual or corporation, whether domestic or overseas, to own Hong Kong real estate.

11.

Stamp duty taxes are payable on the purchase of Hong Kong real estate, the rate of which varies according to the total cost of the property. Owners of buildings in Hong Kong are charged property tax, which is based on the property's rental income. The rate of tax is 15% on the property net assessable value (NAV) less a statutory deduction of 20% for repairs and outgoings.

12.

Rent yield rates are high in Hong Kong, and the prime rental market is largely supported by expatriates working in HK. According to a Savills report, “Hong Kong is 12% more expensive to rent than London, and 35% more than New York, and double the cost of Moscow” (Savills). Some forecasts have been for a rent yield increase of 15% for 2011.

13.

Asia Property Consultants independently assists international property investors effectively and efficiently manage all aspects relating to the purchase and sale of Hong Kong real estate. Whether the client is seeking residential property if migrating to Hong Kong, commercial property for business needs or as property investment to expand global assets, we source latest real estate market information to enable us to offer honest, reliable opinions on: i) Hong Kong real estate cycles; ii) the current and future outlook for Hong Kong real estate; and iii) expected interest rate and currency movements and their impacts on Hong Kong real estate. In addition to our own experiences, our sources include statistics and forecasts from reliable, reputable sources including the Hong Kong Ratings and Valuations Department, Invest Hong Kong and the Hong Kong Monetary Authority.

For more information on the Hong Kong real estate, telephone us at (+852) 8331 1911 or contact email@healyconsultants.com