New property agency looks beyond Hong Kong gloom to promise of Greater Bay Area opportunities
- Xifeng Property Group is targeting rising demand for residential property in the Greater Bay Area
- It’s a good time to start the business as costs are lower while demand for mainland property is increasing, co-founder says
Hong Kong’s property market has taken a beating from the pandemic, but Kenneth Kwok, the co-founder of Xifeng Property Group, has instead cashed in on lower retail rents and manpower costs to set up his 200 sq ft office in Mong Kok. He pays a monthly rent of about HK$15,000 (US$1,934), half of what it would have been during pre-pandemic times.
Noticing the rising demand for residential property in the Greater Bay Area, Kwok and Jason Shum, his co-founder, chose to hone this as their niche. Their venture comes amid rising home prices in bay cities. For instance, according to an index compiled by Centaline Property Agency, the prices of new and used homes in Shenzhen scaled a fifteen-month high in November, rising by 32 per cent.
Four cities – Guangzhou, Foshan, Shenzhen and Dongguan – last month saw home prices rise to their highest levels since March 2016, when Centaline began gathering data in the development zone.
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Transactions remained active in these nine mainland cities last month, with Shenzhen in particular seeing its first-hand transaction volume hit a five-year high, Centaline said. Hong Kong’s transaction volumes and home prices were, however, subdued by the fourth wave and is expected to remain under pressure.
In the first few months of the pandemic, Kwok observed that most Hong Kong buyers were reluctant to buy mainland Chinese property, as it was where the coronavirus was first reported.
