mainland chinese still snapping up hong kong luxury housing
News Posted On: 17 February 2012
Government restrictions in China are still prompting Mainland Chinese to purchase luxury property in Hong Kong. Residential property sales have dropped in Hong Kong due to the government's action to bring down inflated property prices, but this doesn't seem to be affecting new luxury developments.
Developments in West Kowloon, the Peak and Central are sought after as investment properties or second homes, and demand for homes in these areas is still high.
Some luxury developments in prime locations are selling out within a day or so, but developers are working hard to sustain this demand by pricing property closer to the price of previously owned homes, and are also holding roadshows and advertising properties in mainland China.
It's estimated that buyers from mainland China account for around 25% to 40% of sales of new luxury flats in Hong Kong, and it's expected demand will remain high this year even though property prices are expected to fall by between 10% and 30%.
Because the projected price falls are quite high many local buyers are choosing to wait and see what happens, whereas high net worth individuals from mainland China prefer to invest their money in Hong Kong. This is especially true now because of the governments two year campaign to bring down property prices on the mainland.
Mainland buyers have been purchasing Hong Kong property since 2008 when the Chinese government implemented a $570 billion stimulus package to stimulate the economy.
This had the effect of sending money into the property market in Hong Kong which was already amongst the most expensive in the world, and many local buyers are now priced out of the market. Thus, a price correction would be good news for them.
View China property for sale
Written by Les Calvert
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