HONG KONG • For the first time in almost two decades, home owners are in the minority in Hong Kong, underlining the city's status as the world's least affordable property market.
Only 49.2 per cent of domestic households in Hong Kong owned the quarters they occupied as of the end of last year, the lowest since 1999, according to data released by Hong Kong's Census and Statistics Department this week.
The proportion of households who owned peaked at 54.3 per cent in 2004.
Hong Kong's property prices have tripled since 1999, thanks to abundant liquidity and limited supply of apartments, according to the Centaline Property Centa-City Leading Index.
The city was named the least affordable real estate market in the world for an eighth year by Demographia, an urban planning policy consultancy, beating almost 300 metropolitan housing markets across nine countries.
By comparison, the household home-ownership rate in the greater New York area was 49.9 per cent on average last year, according to United States Census Bureau data. In Singapore, where the public can obtain government housing, the rate exceeds 90 per cent.
Hong Kong Chief Executive Carrie Lam has admitted that several rounds of market-cooling measures have failed and it is impossible for the government to curb prices.
There is not much you can buy if you have HK$2 million (S$335,000) to spare.
Private homes in Discovery Bay - a residential development about a 30-minute ferry ride from downtown Hong Kong - currently sell from about HK$8 million to HK$80 million, said Mr Denis Ma, head of research for Hong Kong at real-estate services company Jones Lang LaSalle Ltd.
Based on recent transactions, his firm estimates that prices in the Central and Western districts start from HK$5 million for smaller apartments in older buildings.
They go as high as about HK$1 billion for houses on the Peak, one of the highest points in the city.
Faced with soaring housing prices and rock-bottom interest rates, Hong Kong residents have been known to put their money into unusual investments - including high-priced parking spaces and taxi medallions.
"You have HK$2 million, better buy a golf buggy rather than put it in the bank," said Mr Bill Chan, a director at Discovery Bay real-estate agency Century 21 Newcourt Realty.
The Hong Kong Monetary Authority's recent interventions to maintain the city's currency peg have reduced local liquidity and may prompt banks to finally lift mortgage rates.