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  • Sep 21, 2014
  • Updated: 10:32pm
NewsHong Kong
COST OF LIVING

Hong Kong rents for well-off expats ‘most expensive in the world’

Three-bedroom homes in areas popular with rich expats cost twice as much to rent as those in Singapore, study finds. But gap is shrinking

PUBLISHED : Thursday, 06 March, 2014, 5:55pm
UPDATED : Friday, 07 March, 2014, 5:16pm

Rent on high-end flats in Hong Kong remains more expensive than in any other city worldwide - double the level of Singapore - despite a slight fall in the past year, an annual study found.

The survey by human resources consultancy ECA International found that the average monthly rent for three-bedroom flats in areas popular with expats in senior jobs, such as The Peak, Discovery Bay and Sha Tin, was US$11,444 per month last year.

While the price was down 1 per cent on 2012 - a factor attributed by researchers to government efforts to cool the property market and a trend for companies to send lower-ranking staff to the city - rents remained 23.5 per cent higher than in the second priciest city, Moscow.

It is the ninth consecutive year Hong Kong has topped the table, and the 13th time it has ranked most expensive since the survey of rents for expats began in 1996.

And it came just days after regional rival Singapore was named the world's most expensive city in another survey by the Economist Intelligence Unit. Hong Kong ranked 13th in that study, which took into account the cost of 160 products and services but excluded housing costs.

But Lee Quane, ECA's regional director for Asia, said high rents had little impact on Hong Kong's competitiveness. And the difference in rental costs between Hong Kong and Singapore was narrowing, though the gap with Tokyo was widening fast.

Four years ago, rents in Tokyo were 6 per cent lower than in Hong Kong. This year they were 55 per cent lower. The Japanese capital has seen rents fall in relative terms partly as a result of the weakening of the yen against the US dollar, the currency in which the survey is conducted. Rents in Mumbai were also down due to the weak rupee.

In Singapore, rent for a three-bedroom flat was US$5,630, while Shanghai ranked ninth globally and fourth in Asia, with an average rent of US$5,124.

Quane believed that the fall in Hong Kong rents was in part a reaction to a series of government measures to cool the property market.

The measures, including higher taxes for people who sell a flat soon after buying it and for corporations and non-Hong Kong residents buying homes, encouraged owners to rent out their properties rather than sell them, Quane said.

He also said companies were sending more junior staff to Hong Kong. Such employees were more likely to look for flats in less expensive locations, such as Tsim Sha Tsui.

Quane said international companies had long accepted that rents in Hong Kong were high. He said most companies that sent staff to the city were in sectors such as finance and law, and the alternative was likely to be expensive cities such as London, Singapore and Tokyo.

"Hong Kong was significantly more expensive than Singapore in 2007, but now the gap is much less," he said, noting that other costs of employing someone in Singapore, including medical insurance, could be higher.

The findings echoed comments by property agents locally. Anne-Marie Sage of property consultancy Jones Lang LaSalle, said last month that luxury residential rents dropped 3.3 per cent last year.

Globally, average rents rose 2 per cent, while rents in Asia were down 1 per cent.

 

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Chinsg
I live in a ~1900 sft (gross) 3+1 rooms flat with two car parks in an estate place called the Hong Kong Garden in the N.T. I got a full sea view and plenty of green surrounding the estate, perfect for someone like me who like running and hiking. While there is no MTR nearby, <30min drive to the West Kowloon and <40min to Central with plenty of public buses. Less crowd and no sardine-packed morning. You can let a place for the same size for around HKD30,000/mth. The fact is there are plenty of choices in HK but most expats just set their mind in Mid Level (where I used to live in a ~900 sgt flat), Pok Fu Lam etc.. The choice is theirs but I bet they will spend wisely if the money is from their own pockets.
HK-Lover
It's without any doubt that HK has one of the highest property prices and sooner or later HK will choke and suffocate on its property prices because the average HK citizen cannot afford liveable and truly enjoyable housing .
However, the majority of expats living in such expensive places in HK actually live in less prestigious and luxurious houses back home where they have to pay housing out of their own pocket. And they often commute 1 hour back home (because of the lower cost in the suburbs) which would be equal to living in the New Territories and not on the Peak, Mid Levels or South Side which are a mere 20-30 min from their offices on the north side of HK island
dynamco
'Peak, Mid Levels or South Side which are a mere 20-30 min from their offices '
mere ?
Mid levels, maybe, probably quicker to walk
Peak at 0600 OK Peak from 0800, forget it
South Side you obviously never saw the tailback from Stanley to Central
I can travel from Tai Lam tunnel area in NT to Central in 25 minutes by bus or 20 minutes by car
bunko8@yahoo.com
still beats the 1.5 to 2 hours of commute to nyc from nj or long island. monthly transport costs of $300-500 for trains + another $112.
dynamco
someone should tell the fools at the Economist Lack of Intelligence Unit who always exclude HK rents from the cost of living surveys, presuming that expat people are street sleepers here
 
 
 
 
 

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