Demand for prime, high-end residential properties in Hong Kong is weakening, forcing landlords to lower their asking rents by as much as 20 per cent.
This comes as global financial institutions place their expansion plans on hold and reduce housing allowances for expatriate staff due to the world's grim economic outlook.
Property consultants say this trend could worsen in the second half of the year if the crisis shows no sign of improvement.
'Rents on homes leasing for more than HK$150,000 a month has become a disaster sector,' said Koh Keng-shing, managing director and founder of property consultancy Landscope Christie's International Real Estate.
As a growing number of investment banks had been scaling down their operations, it was getting hard to find alternative tenants able to afford such high rents, Koh said.
Landlords have consequently started cutting rents across the board. Rents for flats being leased at HK$100,000 to HK$200,000 a month and coming up for renewal have been lowered by about 10 per cent. And rents for flats being leased at HK$50,000 to HK$100,000 a month have been cut by 2 to 3 per cent.