Waking up to realty
WHETHER YOU have made or lost money in the volatile property market, there is no denying that the industry will remain an important pillar of Hong Kong's economy. While property ownership is an attractive option for families to create wealth, the Hong Kong stock market, too, has traditionally been heavily dependent on property-related companies.
Compared to other countries, Hong Kong has a high level of home ownership. However, there is also a very active private and commercial rental market. The local property business is known for its sensitivity to economic and political events.
Following the handover and economic difficulties in 1997, the Hong Kong property market went into a slump which continued until after the Sars crisis. But it has been on the rebound since April 2003, with property prices recovering between 60 per cent and 70 per cent of their 1997 levels. The year 2004 was particularly good, with prices recovering 30 per cent and continuing to increase until local banks raised interest rates again last September.
The aggressive price rise caught both the public and the real estate industry by surprise, causing the market to slow down.
There are indications that the upward trend in property prices will resume soon, bringing with it some exciting employment opportunities.
'We feel that the short adjustment period is over and are expecting a 10 per cent rise in property prices this year, probably in the second half,' said Anthony Kwok Chong, associate director of corporate affairs for Centaline Property Agency.
'In line with this [price rise], we are expecting to recruit between 200 and 300 new sales agents in a couple of months.'
Recruits will mainly be experienced property sales staff who have either a sales licence or an estate agent's licence. Centaline has about 2,600 staff in its property agencies.
And just like the property market, the work had its ups and downs, Mr Kwok said.
'When the market is good, the working hours can be rather long, and sometimes sales staff might work until midnight if they are negotiating a deal. But when the market goes quiet, they might have very little to do,' he said.
Buggle Lau Ka-fai, chief analyst for strategic development at Midland Realty, agreed that the second half of the year should see an increase in recruitments, especially of sales and property agents. Experience and knowledge were important factors for candidates.
'Increasingly, people who are buying property expect detailed advice and want our staff to analyse the market for them. People want an overview of what is going on in the market,' Mr Lau said.
Midland Realty has 482 branches in Hong Kong and it employs a large workforce of 5,644 agents. Any growth in the market can lead to significant job opportunities.
Anyone considering working in the property industry should have a long-term view as the property sector can be very unpredictable.
'All the fundamentals are healthy, such as rising employment levels and salary increases. We do not expect any major changes in government [policy] direction,' Mr Lau said.
Office rents increased by a staggering 75 per cent last year and are forecast to rise by 25 per cent this year. Mr Lau is not surprised by this continuing trend.
'The limited supply of office space will cause this trend to continue, especially in Central's core business area. The only new space in Central in recent years has been the Two IFC building and AIG Tower and there are no big new launches imminent. Even though Two IFC is enormous, it has been quickly absorbed by the market,' Mr Lau said.
Ivan Ho Shiu-cheong, managing director of Ricacorp Properties, is optimistic that office rents will continue to rise. He also believes that the low supply of new homes will guarantee price rises in the domestic sector.
'Future home and office supply will be dwindling, so we are quite optimistic that prices will go up in the long term,' Mr Ho said.
'The fast-growing China market, as well as the investment capital from the mainland, will give strong economic support to Hong Kong.'
On the whole, the outlook across the property sector appears favourable. Demand for specialised staff will increase as rivalry between property companies intensifies.
'As we expect the property market to run hot in the coming years, we envisage stiff competition among property developers in project promotions to locals and potential expatriate buyers,' Mr Ho said.
'There is a strong need for professional marketing personnel among property developers as well as real estate agencies,' he said.
KEY PLAYERS
Sales agents
Estate agents
Accountants
Market analysts
Administration
Marketing personnel
Human resources
Portfolio managers
JARGON
Estate agents
People who buy and sell properties for a client in exchange for a fee
Property
A building and any land belonging to it; a piece of real estate
Developers
Designers and builders of new homes
Housing supply
When there is too much new development, prices drop to stimulate demand and when there is not enough new housing, prices rise as demand is strong
New launch
New housing or office units
Negative equity
When the value of a property falls to less than the outstanding mortgage
