HONG KONG - Notorious for its sky-high property prices, Hong Kong has long been home to some of the world's tiniest apartments.

Now, one of the city's landlords wants to breathe some life into the city's infamous claustrophobic 'coffin homes' - apartments that are stacked with wood and metal sleeping compartments.

Borrowing from the capsule hotel concept that originated in Japan, entrepreneur Sandy Wong's snazzy upgrade turns the single-sized bed sleeping quarters into 'space capsules', complete with key-card access, air-conditioning and dreamy blue lighting.

Wong told the South China Morning Post the response to the 'space capsule' sleeping pods have been encouraging, with 51 of them having been rented outin the span of just three months.

He said he now hopes to rent out 1,000 more in a year.

Although the 'space capsules' may originate from Japan, Wong's capsule homes are manufactured in Guangzhou.

Measuring around 2m long and 1.1m high, each pod comes with the usual mattress and beddding along with three different lights, charging outlets and a mini fire extinguisher.

Rental for the pods are priced at between HK$2,800 (S$499.38) and HK$4,500 (S$802.57) for a minimum one-month stay.

The pods come with a shared kitchen, bathroom and common area.

At that price, the monthly rental for a pod is more expensive than a coffin-home equivalent in the Sham Shui Po district, which costs around HK$1,800 (S$321.03),Wong said. But they are still more affordable than a subdivided flat which is equipped with its own kitchen and bathroom.

Wong told the Post the idea behind the quarters came because of the poor living conditions in the so-called 'coffin homes'.

"So many people in Hong Kong are living in cubicle homes or partitioned flats, but the conditions are really bad," he was quoted telling the Post.

"There's no proper ventilation, the places are infested with bugs and they smell. I thought to myself, is there a way to provide a more comfortable space for these people?" he added.

Hong Kong has one of the world's most unaffordable property markets. The city said on Saturday it was moving to raise the stamp duty to 15 per cent for all residential purchases, except for first-time buyers who are permanent residents, in a bid to cool the property market.