Luxury Insider: The Pearl of the Orient Comes at a Hefty Price
Even with your eyes closed, you just know you are in Hong Kong. Some sounds or feelings are unmistakable. Like the vibrations of the suspension bridges on the way to downtown, the humming sound of the tunnels cut in the rocks, the bouncy roll of the shuttle boats from the island to Kowloon in the waters of the Victoria Harbour, the loud horns of all those cars stuck in traffic in the narrow streets of the Central district, the zigs and the zags of the steep ride to the Peak, the beehive-type buzzing of thousands of people right around you and constantly in motion…
And then you open your eyes. Before you: the majesty of Hong Kong. An amazing sight that no postcard can come close to revealing. A patchwork of bays, peninsulas and islands crowned by hundreds of the most daring skyscrapers, some along the waterfront and some “glued”, somehow, to the vertical cliff.
Yes, there is a reason or two why Hong Kong is the most expensive place to live, anywhere. Beauty has a price and the uncommon financial success of the “Pearl of the Orient” makes it possible for many to pay that price. In fact, with the local stock market reaching a 7 year-high last month and the growing demand from wealthy buyers from Mainland China, real estate values are not likely to shrink anytime soon. FYI, prices jumped 17% last year (y/y) and 2.3% just from February to March! Before I forget…Another quick FYI to get your full attention: Mabel told me that there is one property on the market priced at $13,000 a sq.ft. No kidding.
My host in Hong Kong, a few weeks back, was a friend and arguably the most reliable real estate expert in all of Asia. Beverly Sunn is the founder & CEO of Asia Pacific Properties, a leader in the field of real estate investments, transactions & relocation. Beverly is my “Wikipedia” when it comes to Asia. She possesses the wisdom of the East and the curiosity of the West.
She was nice enough to set me up with three members of her executive staff: Michelle Leung, Mabel Tan & Isabelle Cheung. I got a quick but thorough education on Hong Kong real estate, followed by a special Tour of three luxury properties now actively on the market on the island. All three are representative of the high-end market in the priciest high-end market in the world today. So let’s go on the tour together if you will, so you know what you can find and expect for your money.
The first stop was in the so-called “Mid-Levels” area of the island, an area where hi-rise towers have been mushrooming over the years. Obviously the N.1 value here is the view, or rather The View. You can see the waterfront, the harbor, Kowloon, nothing but pure wonders to the eyes. Of course you can also see a bunch of other towers all around, some messing up your panoramic million dollar view.
The apartment (we would call it condo) is about 3,300 sq.ft., with 4 BR and 3 BA, on the 27th floor of a 6 year old building equipped with luxury amenities (Club House, BBQ area, Function Room, Gym, Golf Simulator, Playground, Heated Outdoor Pool…). Very nice and clean. Huge windows, as you would expect, to best leverage the views. Typical drawback around here: small closets. Good thing for the storage business which is big business in Hong Kong. The price you might ask: 15.6M US Dollar, which turns out be an “affordable” $4,700/sq.ft.
Next on the Tour, a hi-rise apartment in “The Peak”, the most expensive district in HK, dominating the local real estate landscape with views forever. For a price tag of $48.5M (US), you get 7,000 sq.ft., with 3 BR, 4 BA, the traditional maid’s room, a balcony (not a good idea if you suffer from vertigo), a terrace, a roof top and 2 covered car parking spaces. I like the district a lot, the condo a lot less. My take only. You might want to get yourself a one-way ticket and judge for yourself.
The third and final property (3-level townhouse) touched my heart a bit more. Maybe because it is located in the quaint “village” of Stanley, at the Southern extreme of the “South Side” district. Mediterranean-type feeling with the water a few hundred feet away and a peaceful setting. 4,922 sq.ft. of beautiful space, with 5 BR, 5BA, a powder room, a maid’s room with BA, a 1569 sq.ft. roof top, a garden of roughly the same size, and 2 car slots. The project has everything you need in terms of amenities, services and facilities. All that for $16M. Good deal really. But don’t take my word.
Remember that if you buy one of those 3 properties, or any other, you will have to add a few dollars to the purchase price. Stamp duty it is called. This surtax is supposed to reduce demand and curb speculation. It has not worked so far, but I am sure the local administration likes the concept. As a non-resident, you pay roughly 3 times more than a HK resident, up to nearly 15% of the price. In that price range, it does not hurt too much, but I thought I would mention it, just in case you already bought your ticket and need to withdraw money from the bank.
by Alain Pinel
General Manager of Intero Prestigio international