The continuing strength of Hong Kong's luxury properties has prompted agencies to expand their presence and services in this lucrative market.
The attractiveness of the luxury market can be demonstrated by the rise of sales exceeding HK$10 million to 8.48 per cent of transactions by the end of last month. The increase in the New Territories was especially significant, surging from 34 per cent last year to 44 per cent.
Hong Kong Property is promoting its luxury brand Superior Home to strengthen its presence in the high-end market, with special training for staff that includes Putonghua, so that they can communicate better with mainland investors.
Jeffrey Ng, senior executive director of Hong Kong Property, points to the strong underlying demand for luxury homes from local and overseas buyers. 'The market is now perhaps slightly slow with sluggish transaction volume, but prices remain high. We have confidence in the market and it is time to grow our network and size strategically,' he says.
Hong Kong Property is opening more outlets in locations catering to the needs of luxury property owners and buyers. After opening its Superior Home branch covering the New Territories last month, the firm plans to open similar outlets on Hong Kong Island and in Kowloon in the coming quarter.
'We have seen a significant increase in the number of families earning a monthly income of more than HK$100,000 over the years. That means many people are financially strong to upgrade and move into bigger properties. At the same time, strong overseas buying demand, especially from mainland investors, will continue to drive the luxury residential market,' Ng says.
Hong Kong Property intends to increase its workforce and retail network by up to 20 per cent during its expansion, with its outlets numbering more than 100 by next year.
In the first half of this year, the agency hired more staff for its expansion in Kowloon. It opened outlets in Waterloo Road and Broadcast Road, and enlarged its branch at The Victoria Towers in Tsim Sha Tsui.
On Hong Kong Island, Hong Kong Property has taken up streetfront shops at Wong Nei Chung Road in Happy Valley, Tin Hau Temple Road in North Point and Lee Tung Street in Wan Chai to reach out to more customers. Its expansion in the New Territories will concentrate on the northwestern region from Tsuen Wan to Yuen Long, where developers are building new projects in line with massive infrastructure developments.
'Luxury home prices in the northwestern part of the New Territories are rising fast. For example, the Ngau Tam Mei suburb near Yuen Long is becoming a luxury residential neighbourhood. We are going to expand our retail network along Castle Peak Road to draw more business,' Ng says.
Retail network expansion is only part of the equation. Centaline's Stately Home believes sophisticated luxury property investors are now looking for comprehensive personalised services that are capable of helping them buy, manage and sell properties strategically.
In addition to strengthening its retail presence constantly, Louis Ho, director of Stately Home, says it is imperative to provide quality value-added services to cope with the specific needs of customers in the luxury market.
'Many investors are now putting their money into different baskets. They may have a mix of properties in their portfolio, including luxury homes, retail and even industrial and office premises in Hong Kong and other places of the world,' he says.
'We are no longer merely sales and purchase agents, but playing a role as asset investment consultants to help customers manage and enhance the value of their portfolios. What we need is not just retail outlets. We are taking up office premises as bases for our staff, including one in Central for our Island South and The Peak luxury team.'
Ho says the specialised team of Stately Home works in a way similar to the financial planning and private banking operations of institutions. Its services encompass advice on aspects such as the potential of property development and value enhancement through renovation.
The increasing presence of mainland investors offers immense business opportunities, Ho adds. These cash-rich investors are targeting luxury properties in traditional districts of Hong Kong Island, Kowloon and the New Territories. Some also establish a mix of properties in the Asia-Pacific region, Europe and the United States.
Ho says Centaline and Stately Home are striving to flex their muscle further abroad and establish a global network to serve customers with a diversified property portfolio.
Lying ahead is a battle for the best in the agency industry to win through brand recognition and service enhancement.