It's one of the big questions in global finance these days. Hong Kong has the highest home prices among major global cities, including London, New York and Tokyo, according to a report by the international property consultancy Savills. Many believe the market is ripe for a setback, although opinions differ on how serious. "Hong Kong's property market is like a patient getting early-stage cancer. However, our government gives it medicine that is designated for final stage cancer patients," says Raymond Lee, the regional chief executive of Savills. "The high dosage kills both good cells and cancer cells. The patient will also die." Prices show no serious signs of falling despite repeated attempts by the government to curb gains. Against that, there is a housing shortage, mortgage costs are low and there has been a buying spree by mainland Chinese. However, most of the smart money is now on prices dropping. Prices could fall as much as 20 per cent over the next two years, according to Deutsche Bank, after lenders in March raised home-loan rates by 25 basis points in response to tighter risk rules. Savills echoed the Deutsche prediction, saying property prices in Hong Kong may drop by up to 20 per cent across the board because of the latest anti-speculation measures taken by the government. Since returning to China in 1997, Hong Kong's eco...
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Posted May 03, 2013
By adem aslan