Individual investors drifting towards industrial property
Industrial units are proving increasingly popular as stamp duty is low and down payments are small compared with buying a residential flat
Property investor Rainbow Chan has found her pot of gold in Wah Tak Industrial Centre in Kwai Chung.
Three months ago the Tsuen Wan housewife, who is in her mid-40s and lives in an apartment owned by herself and her husband, invested HK$1.38 million in a 567 square foot industrial unit in the industrial estate.
Based on the latest transaction prices in the estate her unit is now valued at HK$1.8 million, which means that if she decided to sell it today she could pocket a profit of some 30 per cent after just three months.
"The price increment is quite impressive. It is much better than my expectations," said a beaming Chan.
Investment sentiment in industrial real estate has been booming since the last quarter of 2012, driven by rising liquidity, falling interest rates and the attraction of small down payments compared with investments in residential property.
According to Ricacorp Properties, average monthly transactions in the sector exceeded 1,000 in the last quarter of 2012, up from 700 deals completed in the first quarter of the year. "Prices in the last quarter rose 15 per cent on average," said Raymond Chu, senior district director of industrial-commercial real estate division of Ricacorp Properties.