When even Hong Kong’s super wealthy opt to rent, something is not right
Recently revealed decision by local movie stars highlights need to urgently tackle one of the city’s most pressing issues
Julian Cheung Chi-lam and Anita Yuen Wing-yi are household names in Hong Kong and on the mainland for the many impressive roles they have played in films and TV dramas, and also because they are seen as a happily married, model couple in showbiz circles.
But there’s one thing about this rich and famous couple that you might not know, something I was not aware of until last week: they decided years ago never to buy property in Hong Kong. The reason was simple. Prices were outrageously high and too unreasonable.
At a Mid-Autumn Festival gathering, as some of my friends were sharing viral online messages, one showed us a story from a mainland website prompted by the couple’s recent appearance on a reality show for a local TV station.
“Do you know Cheung and Yuen have a strange habit?” the headline asked. The story went on to explain the “strange habit”: their constant house moving by renting luxury apartments one after another every few years instead of buying a permanent home. Cheung once reportedly remarked: “With the amount I need to pay for a house [in Hong Kong], I can rent till I’m over 130 years old.”
Of course, the couple earn tens of millions of dollars a year and could buy any luxury home they like, and the homes they rent are far from affordable for the average Hongkonger. But their preference to rent reflects in a sense the absurdity of Hong Kong’s housing situation.
No wonder there were mixed interpretations when Cheung Kong Property Holdings, owned by the city’s richest man, Li Ka-shing, bought a plot of land from the government for the first time in four years. Paying a 33 per cent higher premium, the developer shelled out HK$1.9 billion for the site in Kau To Shan, near Sha Tin in the New Territories, an area traditionally for luxury residential buildings.
Some saw it from a political perspective and took it as Li’s return to Hong Kong. In recent years, the tycoon has been questioned from time to time as to whether he is abandoning the Hong Kong and mainland markets by shifting to global investments. He has repeatedly denied it.
Others saw this latest move as nothing more than a natural need for a major developer to replenish its land bank.
To be frank, any decision involving Li and his business empire triggers conflicting reactions in this city. But Li, after all, is considered by many to be a man of wisdom and vision. So while some are happy to see Cheung Kong’s return to Hong Kong’s property market, people may also see it as an indicator of rising property prices in the years to come, as predicted by the tycoon, especially in the luxury market.
One of the key talking points in town over the past week has been housing and land supply to meet both private and public demand. While the buying frenzy in the private property market, including commercial buildings, has shown no sign of slowing down, the government is under pressure, driven by newly elected lawmaker Eddie Chu Hoi-dick of the Land Justice League, to come clean on why a massive public housing project at a Yuen Long site was delayed and allegedly scaled down.
There were concerns that with several localists elected to the city’s legislature, the thorny issue of independence would become the government’s immediate headache. But the first explosion of a political time bomb turned out to be the complicated land development issue in the New Territories, which is still snowballing.
It has put the government between a rock and a hard place in deciding whether to put the vested land interests of powerful rural groups ahead of the pressing public housing needs of the underprivileged.
Add that to the mix of property fever and other political and social challenges, and the complexity of the coming chief executive race is written on the wall.