Hong Kong property

Hong Kong still the world's most costly city for billionaire homes

PUBLISHED : Thursday, 21 March, 2013, 12:00am
UPDATED : Thursday, 21 March, 2013, 8:36am

Hong Kong remains the most expensive city in the world for billionaire trophy homes, a report by international property consultancy Savills says.

"Billionaire" properties in the city average £7,200 (HK$84,400) per square foot for an average home of 5,200 sq ft, it says.

The report calculated a price index of homes for the super rich in 10 top cities around the world at the end of last year.

Savills compared homes that members of an "executive unit" - a group of people who might start up or expand a global business in any country - would be likely to choose in each of the 10 cities.

Tokyo ranks second at £5,000 per sq ft for an average flat of 16,000 sq ft, and London third at £3,500 per sq ft for an average flat of 7,900 sq ft.

Paris, Moscow, New York, Shanghai, Singapore, Mumbai and Sydney round out the list.

"Billionaire activity has been concentrated on high-end urban centres rather than leisure properties in the surrounding countryside or regional sunbelts," said Yolande Barnes, head of world research at Savills. "This reflects a global preference for urban locations, as these billionaires need to be located in cities where they can do business."

However, prices for super-deluxe homes in Hong Kong began to fall after the government imposed in October measures to curb investment demand.

Terry Chan, a StatelyHome senior account manager at the Deep Water Bay branch of Centaline Property Agency, said the top end of the market suffered. "There are no big-ticket transactions at all, as cashed-up mainlanders and corporate buyers have retreated from the market after extra stamp duties were imposed on them," he said.

"The number of transactions for luxury homes in Deep Water Bay dropped to below 10 a month, with each deal involving just HK$10 million to HK$40 million. Prior to the introduction of the stamp duties, there were 30 to 50 deals a month, each worth more than HK$100 million."

John Siu, an executive director at valuers Cushman & Wakefield, however, believes Hong Kong will continue to attract the world's richest people to set up home. "Hong Kong's political stability and well-established legal framework create an excellent environment for businesspeople," Siu said. "We will retain our competitive advantage over other cities."