Middle-income group squeezed out of residential sector amid tough times
An hour-glass profile is emerging in the Hong Kong residential market, property analysts have observed. They note increased buying in the market for low-end flats, and signs of reflation at the top-end.
Referring to flats at HK$1 million and above, Victor Kwok, an analyst at Credit Suisse First Boston, said demand was likely to be steady and was supported by current affordability variables, especially the record-low mortgage rates of 2.4 to 2.5 per cent per annum.
Luxury units saw a rise, with the 'really rich' snapping up top-quality units in traditional luxury districts in a market of limited supply, according to property agents.
Midland Realty chief economist Buggle Lau Ka-fai said the slow domestic economy of the past few years had hurt the purchasing power of most Hong Kong buyers.
In the meantime, a strong body of buyers had emerged from the community of manufacturers and traders; business folk who had benefited over the past few years from Hong Kong's strong export market, Mr Lau said.
For example, in July, Yip's Chemical (Holdings) chairman Tony Ip Chi-shing bought a detached house at Kelletteria for HK$42.8 million.
