Luxury rents are climbing, albeit slowly, with estate agents reporting brisk business all over the SAR. Agents said rents had generally risen 2 to 5 per cent in the last few months and landlords were increasingly unwilling to negotiate. They described supply as tight but still adequate for the needs of new arrivals and tenants renewing leases. Property agents report a busy summer season due to a recent surge of arrivals from North America, Australia and Britain looking for accommodation in the $50,000 to $200,000-per-month range. Also, many tenants are shopping around for new accommodation as their leases expire. 'Some people are out looking because their tenancies are up and their landlords have just asked them for large increases in rent,' said Amelia Lim, director of residential leasing at Jones Lang Wootton. As more companies opted to give employees a cash allowance for housing rather than pick up their tabs, more people were shopping around, said agents. Figures released by First Pacific Davies (FPD) indicated that rents in areas such as the south side of Hong Kong Island, the Mid-Levels and Happy Valley had risen by 2 to 3 per cent. The major exception was Pokfulam, where rents ballooned by 13 per cent and more in the last quarter, according to FPD. Agents said this was because the new Western harbour tunnel had made the area more accessible. On the Peak, many agents reported that asking rents continued to climb due to lack of supply. One landlord was demanding $500,000 per month for a detached house. The stock of luxury homes and flats on the Peak had dwindled as developers gobbled up prime sites for redevelopment. 'The Peak is now one big construction site,' said Isabel Michie, head of residential leasing at FPD. 'It is the stock which is controlling the rents.' However, Fizzy Pavri, head of residential leasing and sales and international property with Colliers Jardine, said rents on the Peak had undergone a slight correction. They had eased by just under 5 per cent in the last two months, she said. But demand for housing at the $160,000 to $220,000 per month end of the Peak market was still strong, said other agents. US corporations appeared to have the biggest appetite for such housing. The south side of Hong Kong Island remained popular among corporate tenants with $60,000 to $100,000 a month to spend. FPD said south-side rents were up 1.2 per cent during the second quarter. But Ms Pavri said rents on the south side had long been on a plateau and were rising only in the most popular buildings. Large houses like those at Casa Del Sol in Chung Hom Kok were now renting for $130,000 per month. Homes in the Redhill Peninsula remain popular, according to agents. In Stanley Village three or four-bedroom flats in Gross Point Villa now cost anywhere from $65,000 to $85,000, agents said. In Mid-Levels rents for prime properties were up. Rents in Dynasty Court and the Albany had risen about 11 per cent in the last three months, reaching $95,000 to $98,000 a month. Some agents saw landlords holding some flats off the market until the Government detailed its pledge to increase housing supply.