THE Chinese property market is looking suspiciously like a bubble; one that is on the point of bursting. And when it does, it could well puncture the financial ambitions of a number of Hongkong property developers.
Property prices in the Pearl River Delta have shot up over the last two years. As prices in Hongkong doubled, so they did across the border.
Australian Chinese property developer Perry Siu said Hongkong people had been confusing the value of land in the territory with that in the mainland, and this had been one of the causes of the present property boom in southern China.
Land was such a precious commodity in Hongkong, but not so in China, Hongkong-based Mr Siu said, pointing to the vastness of the mainland.
''Hongkong people feel that, if they own property, then they will be all right. But it is not like that in China,'' he said.
''In 1990, when the boom started, developers bought land in small lots, similar to the way they did in Hongkong. They wanted to build multi-storey, with a swimming pool, tennis courts, a wet market and the like, just like another Taikoo Shing. But it hasnot worked.'' Mr Siu explained that the developers would put a deposit down on the land, enabling them to build one or two tower blocks, and take an option on the rest of the land.