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The View | Hong Kong property is standing strong amid rival Singapore’s challenge
- Singapore’s appeal to investors has risen sharply during the pandemic, but Hong Kong real estate has outperformed expectations despite strong headwinds
- If anything, the pandemic and Beijing’s commitment to the city have added weight to the argument underpinning the case for investing in Hong Kong property
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In Asia’s real estate markets, the appeal of Singapore has increased markedly since the eruption of the Covid-19 pandemic. The results of a survey of investors in the region published by CBRE last month revealed that it was Asia’s third most popular destination for cross-border investment after Tokyo and Shanghai.
Long-standing advantages – political stability, business-friendly policies and the transparency, good infrastructure and access to capital that underpin Singapore’s status as a regional financial hub – are being accentuated by the government’s pragmatic approach to managing the pandemic.
As the global economy reopens and the combination of mass vaccination, therapeutics and prior infection allows countries to begin treating the virus as endemic, Singapore is moving with the times. The government’s decision last June to eschew its zero-Covid stance in favour of learning to live with the virus has bolstered Singapore’s credentials as an international financial centre.
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Hong Kong, on the other hand, is doubling down on a futile zero-tolerance policy that has left the city cut off from the rest of the world. Tougher restrictions, aimed at placating Beijing despite mounting evidence that the hardline approach is backfiring, are damaging the recovery and heightening concerns over Hong Kong’s role as Asia’s premier financial centre.
Last Wednesday, the credit rating agency Fitch Ratings slashed its forecast for growth this year to just 1.5 per cent. It warned that economic output would not surpass its 2018 level until next year, leaving the city as one of the worst-performing economies rated by the firm.
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Hong Kong prepares for tightest restrictions yet as Covid-19 cases top 1,100
Hong Kong prepares for tightest restrictions yet as Covid-19 cases top 1,100
Not surprisingly, the contrast between a sealed-off Hong Kong and an increasingly open Singapore is influencing perceptions of the performance and outlook for both real estate markets.
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