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SCMP Reporter

Only landlords at the top end of the luxury market have managed to take advantage of the current property boom, estate agents say.

  Rents of best-quality luxury flats have risen sharply in some cases, in line with the stratospheric purchase-price increments seen recently, but the outlook for ordinary luxury homes is humdrum with rents likely to remain flat, agents say.

  Rents for super luxury semi-detached homes in Island South district or on The Peak, which have already increased by about 25 per cent in the past quarter, will continue to go up due to the scarcity of best-quality accommodation in these sought-after areas.

  Rents for some Mid-Levels luxury flats, boasting good club facilities and a sea view, could jump more than 20 per cent this year, agents say.

  Agents said prospective tenants were finding it harder and harder to find top-quality luxury flats because speculators were leaving their newly purchased dwellings vacant, waiting for the next purchaser.

  According to Yosha Bekink, residential director with Vigers, it was possible to find a flat at the popular Repulse Bay Apartments for about $74,000 to $80,000 late last year.

  'Now you would be lucky to find anything below $90,000 per month,' she said.

  Overall, landlords should comfort themselves with a 10 per cent increase in rents in 1997, Shih Wing-ching, managing director with Centaline Property Agency, said.

  He said one of the reasons why most rents would not go up dramatically was that there was no speculation in the rental market.

  'Rents will only go up if people can afford to pay more rent,' he said.

  According to David Faulkner, partner with Brooke Hillier Parker (BHP), the rental market is being driven by tenants while the spiralling sales market is being driven more by supply and demand.

  Ms Bekink agreed rents would inevitably go up because there was a shortage of luxury flats which had coincided with increasing demand for flats coming from both local and overseas people.

  However, agents cautioned that landlords would be pricing themselves out of the market if they tried to push rents up too high.

  'Landlords will price themselves out of the market if they attempt to increase their yields,' one agent said.

  Expatriates who were usually willing to pay high rents for luxury accommodation would seek less expensive or older housing instead of paying massive increases in rents, agents said.

  Ms Bekink said employees would be unable to justify such massive increases in rents to their bosses.

  Agents have noted that in the past few months huge increases in flat prices have simply not translated into larger increases in rents.

  They say that luxury rents on Hong Kong Island vary greatly depending upon the building's location, whether it has been purchased by an investor and whether the flat has a sea view.

  Depending on these kinds of factors, rents in popular developments such as Hillsborough Court or Dynasty Court are expected to stay static or increase at most by 15 per cent.

  The same goes for many other developments in Mid-levels and the south of Hong Kong Island. In Stanley, rents have only increased in line with inflation and are expected to continue to do so this year, local agents say.



Rents seen as stable in all but the best luxury homes