Wealthy Hong Kong buyers opt for multiple units in new developments as they seek larger space, amenities

·3-min read

The trend of buying multiple homes in Hong Kong’s new developments is likely to pick up as wealthy buyers opt for larger spaces for their families amid the pandemic, according to market observers.

In new housing estates from Ontolo in Pak Shek Kok to South Land in Wong Chuk Hang, buyers have splashed out hundreds of millions of dollars for multiple flats despite the additional 15 per cent stamp duty levied on second homes.

Such developments tend to have better facilities and management than traditional luxury houses, agents said, adding that since such flats tend to be smaller, buyers were likely to acquire more than one flat at the same time.

Do you have questions about the biggest topics and trends from around the world? Get the answers with SCMP Knowledge, our new platform of curated content with explainers, FAQs, analyses and infographics brought to you by our award-winning team.

“Because of the pandemic in the past two years, both self-occupants and investors are paying more attention to the housing estate environment and facilities,” said Dave Ma, chief operations officer of the Hong Kong Property Services (Agency).

The number of residential property transactions liable for the higher tax on second homes jumped 40.8 per cent to 3,726, compared with a year earlier, according to Inland Revenue Department data. The tax raised from such deals surged nearly 50 per cent to HK$9.36 billion (US$1.2 billion) from a year earlier.

For instance, at Great Eagle Holdings’ Ontolo residential project in Pak Shek Kok, Tai Po, a buyer this month paid HK$131.84 million for three units with a total area of 5,454 square feet on the same floor.

Last May, a buyer paid HK$200 million for seven three-bedroom flats in South Land.

Many buyers of such multiple flats are from the younger generation of rich families living in old estates in traditional luxury districts, Ma said. The combined flats in non-traditional districts tend to be in a similar price range to their existing homes in luxury districts.

The construction of Road King Infrastructure’s South Land residential development in Wong Chuk Hang as seen in September last year. Photo: Edmond So
The construction of Road King Infrastructure’s South Land residential development in Wong Chuk Hang as seen in September last year. Photo: Edmond So

While prices of new flats in Ontolo were around HK$24,000 per square foot in January, flats in luxury projects such as 21 Borrett Road in Mid-Levels fetched HK$136,000 per square foot last February.

Ma estimated that transaction activity was around 30 per cent higher in non-traditional luxury districts, compared with traditional districts, in the last six to 12 months.

Cusson Leung, managing director and head of Asia property and Hong Kong research at JPMorgan, said he had noted a sharp pickup in luxury home sales last year.

Transactions in the luxury segment were mainly driven by the local high-income class and that investment demand continues to remain high despite the persistent weakness in the city’s stock market.

Hong Kong’s benchmark Hang Seng Index fell 14 per cent in 2021, making it the worst-performing market out of 92 major indices tracked by Bloomberg. The index, however, is up nearly 2 per cent so far this year.

Investors are likely to opt for property over stocks to protect their investments from eroding further.

“Buying the physical asset directly is probably easier for most investors,” he said.

More from South China Morning Post:

This article Wealthy Hong Kong buyers opt for multiple units in new developments as they seek larger space, amenities first appeared on South China Morning Post

For the latest news from the South China Morning Post download our mobile app. Copyright 2022.

Our goal is to create a safe and engaging place for users to connect over interests and passions. In order to improve our community experience, we are temporarily suspending article commenting