Personally I put the entirety of the blame on the government for poor land management, just as the video stated, Hong Kong is actually far from a land shortage.
It isn't poor land management. It's intentional gambling with it as leasing out land to developers is the main revenue of HK's government. If you want to change that, you will have to change the entire system.
Yes, but the blame should at least be shared between the British government (which allowed this problem to start off) and the HK governments post UK (since they did not undertake anything as they did not want to effect the status quo).
Tung Chee Wah tried to boost supply but market crashed and had to reverse. Tsang was too "friendly" with the property tycoons. Leung tried to increase supply, but Pan Democrats started to veto every policy that tried to boost supply in Legco. In turn, the opposition parties benefitted as more people became frustrated with property affordability.
@@antihypocrisy8978 Totally agree. Cheap private housing is also against the interests of many middle class families who already bought private residences, especially those who bought recently and are still serving their mortgages.
If i am a citizen of HK and happen to have 1 million usd, instead of buying a house there, i would move out of HK and go to some emerging SEA countries and just living a life there like a king
now many koreans and japanese are doing exactly that, and our housing prices have also increased because of that. moving is just starting another problem for locals in that country.
The issue with comparing HK with any other city, is that HK achieves the combination of no sales tax and a low income tax through revenue from land sales and its "partnership" with the MTR. All governments need to raise money through some means, and if the HK government is to lower revenue by means of property and land transactions, then it must be replaced with some other source of revenue (that is comparable). Anyone who doesn't address this issue has basically no understanding of how HK works.
We can look at Singapore, and even the past of Hong Kong, the massive 85k housing project. We had a plan for diversified economy. It got ignored. If it's impossible, it wouldn't be like that in Singapore. 85k wouldn't pass. But of course, 85k got people suicide. People already bet too much on the property market. The plan was too aggressive. The problem get even worse.
HK always boasts about being the most FREE market and low taxes city in the world. But in reality, the common people in the streets pay super high INDIRECT TAX (via super high property prices) .... and they ended up living like SLAVES working for a 30 m2 apartment or pigeon hole in the sky. And to self console themselves, HKers claim to live in democracy island of HK, and pour scorn at mainland China for not having democracy and freedom. So who are the real modern day SLAVES? 🤣🤣🤣
@@li_tsz_fungSingapore needed to raise sales tax. If HK followed this route, it may affect tourist spending as it is cheaper than buying than Mainland. Hainan and Macau have zero tax on goods. We would lose out to them
What the Hong Kong Government need to do is to have a law that states if a developer has tendered this land it must develop this piece of land within 5 years. If this doesn’t happen then they must do a joint venture with the Government to develop this land failing which this land will be forfeited by the Government. This is easier said than done as the Opposition will never agree to this because they are handled by the rich land and development tycoons. They are also the people who have control over those house owners in Hong Kong who will also go against this as well. The reason that these house owners will go against having affordable housing is that this move will reduce their value of their houses in Hong Kong. Therefore the only way out for Hong Kong is to have the political will to have a hard handed approach to land management, which Hong Kong people cannot accept.
that is what they do here in Singapore, developers need to pay a 35% tax when buying land, if they do not complete and sell the project within 5+ years, they will not get the tax back, if they do, they get most of the tax back
Most of the land in New territories those 10 000 acres they talk about where sold before 1997, when hk was governed by Brits, hk chinese government overtook the problem, which was created way before.
That would make the land much riskier and less valuable so tender prices will drop, meaning government revenue will drop. The overall issue is that the HK government relies excessively on property related revenue so it always has an incentive to keep prices high. The SG government doesn't rely so much on property revenue so it doesn't have the same incentive. Around one third of SG government revenue comes from VAT, that's partially why buying goods in SG is more expensive than in HK. But it would be very difficult to introduce a VAT in HK, not least due to people shopping in Shenzhen or ordering online via JD or Taobao. Maybe raising the maximum salary tax in HK from 15% to say 20% (still lower than in SG) would help the government lean off property related revenue, though high income earners would no doubt oppose this.
@@poshbo The only post that recognizes the root of the problem. The issue with comparing HK with any other city, is that HK achieves the combination of no sales tax and a low income tax through revenue from land sales and its "partnership" with the MTR. All governments need to raise money through some means, and if the HK government is to lower revenue by means of property and land transactions, then it must be replaced with some other source of revenue (that is comparable). Anyone who doesn't address this issue has basically no understanding of how HK works.
@@davec8153 agreed. The way that the HK government spreads the burden of collecting revenue hurts the poor and lower to average income earners too much. This creates a massive gap between rich and poor and leads to mass social discontent, as well as ridiculously small apartments. So the burden must be tweaked so that the rich and high income earners bear more of the burden, and this absolutely can be done without damaging overall competitiveness. The fact that Singapore can be so competitive while providing subsidised housing to 80% of its population is proof of that. But trying to dramatically change the decades old status quo in HK will be extremely difficult.
There are many vested interests who are against affordable house prices. They are not confined to the government, property developers and their stooges in the form of media columnists, so called experts and environmental pressure groups. The vested interests include a large segment of property owning middle class whose wealth mostly consist of their tiny flats. Those who are still paying mortgages risk becoming negative equity if house price crashes due to abundance of supply.
Agreed but regardless of what they want the crash is coming anyways. China is entering a long period of sustained property price deflation similar to what happened in Japan in the 90s. This will inevitably seep over the border and cause significant price declines in HK. In fact, it's already started happening, HK property prices have declined over the past few years and land has been taken off the auction block because of lack of interest from developers, something that would have been unthinkable 5 years ago. The HK government has a serious problem because of the overreliance on land sales for financing as others have detailed.
Singapore is on the verge of becoming like Hong Kong. But it's more of a reason of greed and treating it as only easy investment. But compared to that of HK, SG has better management and leaders to react faster on impacts.
u r saying nothing..sg has an entirely different public housing policy....87% population own their hdb flat by cpf.....uk gave up n quit sg in ruins...bankrupt....leaving behind massive unemployment...
Developers are not to blame. They just do what they are supposed to do as a private company, i.e. maximizing profit, the very principle of any private company. It is the government that has been gambling with property prices at the expense of HK's residents.
Hong Kong should start learning from Singapore’s public housing model. Public housing are literally everywhere besides in wealthy areas and there is not much affordability issue since 99% of the flats are below 1 million in price tag
@@btrue2day but SG government tried to control the price at least. Recently the tax for private condo increased especially for foreigner. Not sure if hk government did make any controlling changes all this while.
@@jefri4176 I would argue SG government has increased the foreigner tax by way too much. Those foreigners mainly buy very expensive 7 or 8 figures condominium in rich neighbourhoods, which has almost no impact on the 6 figures subsidised flats locals buy. As such, they have cooled the luxury market down which has little benefit to the average citizen
@@anonymousman9824 not really. Yes many foreigner buy those few million dollar SGD condo in SG which drive up the price because the local who want to upgrade to condo find it more expensive because they have to compete with foreigner,thus those middle income Singaporean ended up not upgrading to condo but competing to buy bigger hdb instead which drive up the price as well and it trickle down to smaller hdb(subsidized apartments). But the current situation in Singapore is also because of COVID and the current high loan interest rate from global market. Because of COVID,foreign worker who build those bto(build to order) hdb and condo can't enter Singapore and many projects were delayed causing many newlyweds who already ordered the bto hdb or newly unbuilt condo to change their plans and go for the available hdb/condo. Thus SG government have no choice but to increase the levy tax for foreigner in order to prioritize their citizen first. I am one of those "foreigner" who just bought a condo in SG recently in SG in 2021,just before SG government increase the tax Levy into crazy rates for foreigner 🤣😅
This video was totally unserious for understanding the real reasons for Hong Kong’s housing problems. The reason Hong Kong has a housing problem is that the HK government relies far to heavily upon property taxes, instead of income or consumption taxes, to finance its operations. High property taxes translate into high rents. Property Tycoons conspire with the government to keep property prices artificially high, resulting in high rents and a reliable government revenue stream. Having low income taxes and no sales tax might be excellent for attracting business, but the HK government has to get its operating revenue from somewhere. If not from income or consumption taxes, then the revenue has to come from property taxes which are paid via rent revenue. Also, since the wealth of the Tycoons exists in the form of land and buildings, it is in their interests to keep property prices high by restricting the sale of land for housing. The MTR is another scam whereby the government sells undeveloped land to Tycoons at a relatively low price; these tycoons develop the property by adding the MTR and retail space thereby raising its value generating a profit stream, part of which is kicked back to the government in the form of property taxes paid for via users of the MTR and rent from tenants of the retail property. So, the HK housing problem is a totally manufactured problem whereby wealth is extracted from the working class via rents and transferred to the tycoons and the HK government. Singapore, a highly capitalist country, demonstrated how to develop an adequate supply of affordable housing for its citizens and still maintain a thriving business environment. It isn’t that difficult or complicated. But it does take political will. And it appears that the HK government and the property Tycoons lack that political will.
@@flakgun153 Singapore is a high income country at a similar stage in development. If Singapore-a highly capitalist country-can figure out affordable housing, Hong Kong should be able to do likewise. The problem is not that Hong Kong can’t figure out affordable housing; the problem is that the property Tycoons and the government refuse to do what is required to solve this major problem. Again, if Singapore can do it, HK should be able to do it.
@@jstasiak2262 HK has democracy and has regular elections ... BUT they seem not able to vote out a USELESS government at the ballot box. Democracy in HK is a SHAM, yet they are so proud of it. That's really SAD!
@@offiz when you have an election in Hong Kong, the only difference in the candidates, is one wears glasses, or their favourite colors are different, or how they gel their hair. That's it. They have abso-freakin-lutely identical political and loyalty directions. No one ever thinks differently, if you do, you're in BIIIIIIIG trouble.
Real estate is king and the de facto currency of Hong Kong, it is the best all- weather investment for 70 years. Without expensive real estate, it will not be today’s HK ..
Definitely a self-inflicted wound based on ideological laissez faire believes... One of the interviewee mentions HK has no money, HK has earns its own taxation, let's bring up the inevitable comparision, HK lost the plot, how is it Singapore could do it, and HK not do it better?
@@archiehickox6518what? like 3.5billion years? c'mon , both are land scarce but who owns the majority of land (ans: govt), whom both attempted land recliamation (Singapore had to import sand no less), yet the policies of HK govt, create housing crisis where people lives in cages! Only benefit of the high housing cost may be to those whom chooses to leave!
Hong Kong is a nightmare city. Racism, discrimination and anti family environment make Hong Kong an unlivable city. Imagine working 6 days a week and only 1 week paid vacation per year.
property values have lost an average of nearly 20% since 2 years ago. I knew this would happen. You can't sustain that kind of prices when you have over 100,000 high income expats and residents leaving the city.
HK’s financing model is fundamentally flawed… HK government collects very little taxes, so their only real source of revenue is from land sales… Why home prices in HK are the highest… on Earth! Like most other developed countries, HK government needs to start collecting more taxes!
Low corporation/income tax is a source of competitive advantage though, with raised taxes matching other countries, what competitive advantage does HK have?
@@Lambyyy there are definitely taxes which can be raised without hurting competitiveness. For example, the maximum salary tax can go from 15% to 20%, which is still lower than SG's maximum rate of 22% and much lower than global averages. Maybe a small tax of around 15% on imported wine and champagne, or raising the tax on tobacco. And stop wasting cash on the Lantau land reclamation. There are definitely things which can be done, it just takes political will.
There is almost nothing mentioned here about interest rates which the HK government doesn't actually control. The HKD is pegged to the USD so they have to follow the US set interest rate in order to maintain that. The high in 2021 occurred when US interest rates were almost zero making it very cheap to borrow. Immediately afterwards in early 2022 interest rates started to rise which naturally had a cooling effect on the property market. So even if they wanted to cool the market directly (and I don't believe they do when they get a huge amount of their revenue from land sales) their ability to do so is pretty limited compared with other countries
Home prices crashing for 7 years and you still make articles saying things are too expensive... who is going to buy a place when next year it will be cheaper. HK has bigger problems than house prices.
None of what was said here in the video or the comments are the real cause of housing crisis. There are enough houses and land for everyone in Hong Kong or any other city in the world. What caused the housing crisis across the world and will cause further crisis is that housing is available to purchase by everyone, specially housing investors. They are the one that pay more and buy homes that could be bought by one who wants to occupy those homes. Investors buy many homes and in some cases leave the home empty. A person who wants to buy a home and move in will have to compete with numerous home investors who are rich and pay more and will eventually buy that home. They raise the demand for homes 2 or 3 times. The solution is to stop home investing. One person, one home. Then there will be no stress on housing market.
How many years have this been going on? +/- more than a decade? Have this video about HK's housing prices and many many other videos about HK's housing prices lower the prices of houses in HK?
That's what happens when you grant all the land to a single player, in this case the government, the government has a monopoly on housing in Hong Kong, of course it will be outstandingly expensive, all monopolies are.
Nope, the issue isn’t about the Goverment owning all the Land. It’s about knowing your piorities as a Goverment towards satisfiying the affordable Housing NEEDS of your OWN citizens FIRST. By Selling MORE Land to private PROFIT DRIVEN property developers, the prices will skyrocket leading to ONLY the Richest of the Rich could afford them…
There is a solution. Directly sell to citizens. There is no need for "property developers". Property developers can convert into construction companies that caters to each citizen as a customer. If everyone is profit driven, the weakest link will suffer.@@Callsign-Blade_RunnerSG
2:20 For that price i could buy a two story terrace house with 4 Bedrooms buy two Mercedes for cash and and put the rest of the cash in a trust fund and live life jobless.
50-year leases? Please tell me at that price HKers are not paying for just 50-year leaseholds. Are residential properties in HK freehold, 99-year leaseholds or 50-year leaseholds? At that average price of US$1.2mil.
Hong Kong citizens should look beyond their borders to own property, as Hong Kong real estate is unattainable for most. To live better, Hong Kongers need to think outside the box. If they desire a city like Hong Kong, Singapore is the best option. For a beach-like lifestyle, Thailand offers an ideal choice. For a slower and more laid-back pace, Malaysia is a suitable option. Instead of considering migration to Canada, the UK or US would be better choices if Western countries are being considered.
This is intentionally done to make the rich ( landlords) richer, and the poor continue to pay High taxes in land premiums. HK needs a huge supply of working / renting poor to serve the rich. By making property unaffordable- the poor are forced to work.
Singapore managed to get income from the accumulated wealth in its SWF for the past 50 years, thats why it can afford not to over-monetise land and burden the people. Its all about its revenue model. Should Singapore does not have its Reserve in SWF, it might need to squeeze more income from land. Management and vision is key.
Your article was thoroughly enjoyable! Your writing is both clear and succinct, and you have a remarkable ability to elucidate complex concepts in an easily digestible manner. Your practice of presenting both sides of the argument and urging readers to form their own opinions is truly praiseworthy. I'm eagerly anticipating more articles from you in the future!
This report has a narrow scope on the housing market - and that one alone. Isn't it imaginable that a 45% drop in transactions and a 20% drop in prices over two years coincides with HK losing its freedoms? Who wants to live in an authoritarian city like that? There could be longterm trends here that your report isn't even touching on.
People from Hong Kong should consider immigration. It is so crowded in Hong Kong. Like they can even consider moving into China where there is more land and space for families.
5:14 " upholds the free market philosophy " absolutely nothing about not owning the land itself but only leasing it for 50 year's (70 in earlier transactions) upholds " free market " actuality and it's silly to even entertain that it ever could.
Maybe build housing on 10% or fringe areas of the massive country parks. Housing is THE paramount issue in HK, don't tell me about "environment" when people are homeless or living in coffins
ما فائدة الحياة اذا كنا سنجري لناكل ونشرب ليل نهار ليل نهار . الحياة حب ووئام مع الاهل ، صفاء الروح ، مساعدة الناس والعطف عليهم . عن نفسي لا ارى ان العيش في هذه المدن الكبرى لها فائدة غير الازمات النفسية التي يعيشها الانسان في هذه المنازل
The people of HK wants the property prices to be high. They take pride on that. That is what HK is known for....high prices. Can the HK government fix it? Sure, no problem. HK is practically a dictatorship now. The HK government can simply order a million new affordable homes to be built. No issues whatsoever, except, the HK government will not do that. If there are many new affordable homes, that will crash the property prices. A lot of people will be upset and go bankrupt. So the HK people and government will just talk talk talk talk....nothing will be done about it.
Making house expensive is "the economy" of HK! That is the wealth of HK. If anyone makes housing affordable today HK will become Phlippines tomoorow! No governor of HK, be it from UK or locally elected, would dare to build enough houses to solve the problem.
@@1pasupaty Not blaming, just stating the fact. And for decades from 60s to 80s, with short sighted government policies on housing development and favouring the rich developers, HK housing gotten worse.
Between the 1997 Asian Financial Crisis and the SARS epidemic in 2003, HK property prices actually crashed. I used to rent a 2 bedroom apartment in Sheung Wan, the building was completed in 2003 and my landlord paid just HKD 1.3 million. It's worth around HKD 8 million now though it peaked at around HKD 9 million in 2019. So yes, between 1997 and 2003, HK property was actually quite affordable, though very few people predicted that prices would skyrocket again so few people bought property at the low prices. Incidentally, the property crash is also partially why Tung Chee-Hwa's 1997 plan to build 85,000 public housing units was killed off. Government revenue plunged while home owners feared that the flood of new housing supply would further lower the value of their homes.
Typical biased reporting from SCMP. A few things they seems to have conveniently omitted. First thing that comes to mind is the incredibly low income tax / no VAT in services and goods. What was also omitted was the stop of land sale is to protect existing home owners from losing a large portion of their life savings. HK is a densely populated city, even more so than London, NYC. How about you show us how we compare comprehensively........
How's ☭ China's real estate market doing? Evergrande, Country Garden and Kaisa Group all doing well and completing projects on time? The CCP model was kicking farmers off their farm lands, auctioning those lands to private developers to make money because Beijing takes all taxes, leaving land auctions and fines as the primary source of revenue for local governments. ☭ model worked out so well, right?
I found your article to be incredibly enjoyable! Your writing is clear and succinct, and you have a remarkable ability to convey complex concepts in an accessible manner. I also value your approach of presenting both sides of the argument and empowering readers to formulate their own opinions. I'm eagerly looking forward to more articles penned by you!
@@FrostKaiserI actually genuinely agree with you and finally some one who l found in the comment section that actually has a functioning brain for once
Your article was truly a delight to read! Your writing is clear and concise, and you possess a great talent for explaining complex ideas in a manner that's easy to understand. I also appreciate your approach of presenting both sides of the argument and encouraging readers to shape their own opinions. I'm excited to see more of your articles in the future!
Why is Hong Kong housing so expensive ? Oh ! That's because the British make the housing there expensive before they hand over Hong Kong back to China in 1997.
As a matter of fact, Singapore public housing has stabilised over the past 2 years. The government has tweaked the policy which weeds out non-serious buyers/investors and had in effect allow applicants who are in need of housing to benefit. Application rate per unit has dropped (from 4.0 to 1.5 thereabout) and the average waiting period has shortened (4 years to 2 years). To show they meant business, enforcement has stepped and seized units that were bought but not occupied and later put up for sale. The message is clear; public housing is for residential purpose and not for investment. And it works. As expected from the Singapore government.
Personally I put the entirety of the blame on the government for poor land management, just as the video stated, Hong Kong is actually far from a land shortage.
It isn't poor land management. It's intentional gambling with it as leasing out land to developers is the main revenue of HK's government. If you want to change that, you will have to change the entire system.
Yes, but the blame should at least be shared between the British government (which allowed this problem to start off) and the HK governments post UK (since they did not undertake anything as they did not want to effect the status quo).
It feels like Hong Kong government play in being feudal master.
Tung Chee Wah tried to boost supply but market crashed and had to reverse. Tsang was too "friendly" with the property tycoons. Leung tried to increase supply, but Pan Democrats started to veto every policy that tried to boost supply in Legco. In turn, the opposition parties benefitted as more people became frustrated with property affordability.
@@antihypocrisy8978 Totally agree. Cheap private housing is also against the interests of many middle class families who already bought private residences, especially those who bought recently and are still serving their mortgages.
If i am a citizen of HK and happen to have 1 million usd, instead of buying a house there, i would move out of HK and go to some emerging SEA countries and just living a life there like a king
now many koreans and japanese are doing exactly that, and our housing prices have also increased because of that. moving is just starting another problem for locals in that country.
Do you think government will allow that? I don't think so.
@@IamtheMan1111thats true, probably accessing passport will be difficult.
Never go to Philippines or you will be scam by the Filipinos, especially those sweet looking young women that talk sweet things to your ears.
go to Canada.
The issue with comparing HK with any other city, is that HK achieves the combination of no sales tax and a low income tax through revenue from land sales and its "partnership" with the MTR. All governments need to raise money through some means, and if the HK government is to lower revenue by means of property and land transactions, then it must be replaced with some other source of revenue (that is comparable). Anyone who doesn't address this issue has basically no understanding of how HK works.
We can look at Singapore, and even the past of Hong Kong, the massive 85k housing project. We had a plan for diversified economy. It got ignored. If it's impossible, it wouldn't be like that in Singapore. 85k wouldn't pass.
But of course, 85k got people suicide. People already bet too much on the property market. The plan was too aggressive. The problem get even worse.
Correct. This is thus far the most accurate statement regarding the real root of HK’s unaffordable housing problem.
@@li_tsz_fungHK has not GST.
HK always boasts about being the most FREE market and low taxes city in the world. But in reality, the common people in the streets pay super high INDIRECT TAX (via super high property prices) .... and they ended up living like SLAVES working for a 30 m2 apartment or pigeon hole in the sky. And to self console themselves, HKers claim to live in democracy island of HK, and pour scorn at mainland China for not having democracy and freedom. So who are the real modern day SLAVES? 🤣🤣🤣
@@li_tsz_fungSingapore needed to raise sales tax. If HK followed this route, it may affect tourist spending as it is cheaper than buying than Mainland. Hainan and Macau have zero tax on goods. We would lose out to them
What the Hong Kong Government need to do is to have a law that states if a developer has tendered this land it must develop this piece of land within 5 years. If this doesn’t happen then they must do a joint venture with the Government to develop this land failing which this land will be forfeited by the Government.
This is easier said than done as the Opposition will never agree to this because they are handled by the rich land and development tycoons. They are also the people who have control over those house owners in Hong Kong who will also go against this as well. The reason that these house owners will go against having affordable housing is that this move will reduce their value of their houses in Hong Kong. Therefore the only way out for Hong Kong is to have the political will to have a hard handed approach to land management, which Hong Kong people cannot accept.
that is what they do here in Singapore, developers need to pay a 35% tax when buying land, if they do not complete and sell the project within 5+ years, they will not get the tax back, if they do, they get most of the tax back
Most of the land in New territories those 10 000 acres they talk about where sold before 1997, when hk was governed by Brits, hk chinese government overtook the problem, which was created way before.
That would make the land much riskier and less valuable so tender prices will drop, meaning government revenue will drop. The overall issue is that the HK government relies excessively on property related revenue so it always has an incentive to keep prices high. The SG government doesn't rely so much on property revenue so it doesn't have the same incentive. Around one third of SG government revenue comes from VAT, that's partially why buying goods in SG is more expensive than in HK. But it would be very difficult to introduce a VAT in HK, not least due to people shopping in Shenzhen or ordering online via JD or Taobao. Maybe raising the maximum salary tax in HK from 15% to say 20% (still lower than in SG) would help the government lean off property related revenue, though high income earners would no doubt oppose this.
@@poshbo The only post that recognizes the root of the problem. The issue with comparing HK with any other city, is that HK achieves the combination of no sales tax and a low income tax through revenue from land sales and its "partnership" with the MTR. All governments need to raise money through some means, and if the HK government is to lower revenue by means of property and land transactions, then it must be replaced with some other source of revenue (that is comparable). Anyone who doesn't address this issue has basically no understanding of how HK works.
@@davec8153 agreed. The way that the HK government spreads the burden of collecting revenue hurts the poor and lower to average income earners too much. This creates a massive gap between rich and poor and leads to mass social discontent, as well as ridiculously small apartments. So the burden must be tweaked so that the rich and high income earners bear more of the burden, and this absolutely can be done without damaging overall competitiveness. The fact that Singapore can be so competitive while providing subsidised housing to 80% of its population is proof of that. But trying to dramatically change the decades old status quo in HK will be extremely difficult.
There are many vested interests who are against affordable house prices. They are not confined to the government, property developers and their stooges in the form of media columnists, so called experts and environmental pressure groups. The vested interests include a large segment of property owning middle class whose wealth mostly consist of their tiny flats. Those who are still paying mortgages risk becoming negative equity if house price crashes due to abundance of supply.
Agreed but regardless of what they want the crash is coming anyways. China is entering a long period of sustained property price deflation similar to what happened in Japan in the 90s. This will inevitably seep over the border and cause significant price declines in HK. In fact, it's already started happening, HK property prices have declined over the past few years and land has been taken off the auction block because of lack of interest from developers, something that would have been unthinkable 5 years ago. The HK government has a serious problem because of the overreliance on land sales for financing as others have detailed.
Singapore is on the verge of becoming like Hong Kong. But it's more of a reason of greed and treating it as only easy investment. But compared to that of HK, SG has better management and leaders to react faster on impacts.
SG has strict price control and no speculation etc, I can say SG do much well than HK. I believe is thanks to LKW Iron Fist Control.
u r saying nothing..sg has an entirely different public housing policy....87% population own their hdb flat by cpf.....uk gave up n quit sg in ruins...bankrupt....leaving behind massive unemployment...
or you could say property developers are restricting the supply of house and land
Developers are not to blame. They just do what they are supposed to do as a private company, i.e. maximizing profit, the very principle of any private company. It is the government that has been gambling with property prices at the expense of HK's residents.
The Pan Democrats vetoed attempts to boost land supply during Leung and Lam administrations.
Hong Kong should start learning from Singapore’s public housing model. Public housing are literally everywhere besides in wealthy areas and there is not much affordability issue since 99% of the flats are below 1 million in price tag
Hk government don't care for it's citizen unlike Singapore government 😂😅
I see it differently. In some ways the Sg Gov is trying to follow Hongkong, aiming to match Hongkong's population density. Its just a matter of time
@@btrue2day but SG government tried to control the price at least. Recently the tax for private condo increased especially for foreigner. Not sure if hk government did make any controlling changes all this while.
@@jefri4176 I would argue SG government has increased the foreigner tax by way too much. Those foreigners mainly buy very expensive 7 or 8 figures condominium in rich neighbourhoods, which has almost no impact on the 6 figures subsidised flats locals buy. As such, they have cooled the luxury market down which has little benefit to the average citizen
@@anonymousman9824 not really. Yes many foreigner buy those few million dollar SGD condo in SG which drive up the price because the local who want to upgrade to condo find it more expensive because they have to compete with foreigner,thus those middle income Singaporean ended up not upgrading to condo but competing to buy bigger hdb instead which drive up the price as well and it trickle down to smaller hdb(subsidized apartments). But the current situation in Singapore is also because of COVID and the current high loan interest rate from global market.
Because of COVID,foreign worker who build those bto(build to order) hdb and condo can't enter Singapore and many projects were delayed causing many newlyweds who already ordered the bto hdb or newly unbuilt condo to change their plans and go for the available hdb/condo. Thus SG government have no choice but to increase the levy tax for foreigner in order to prioritize their citizen first.
I am one of those "foreigner" who just bought a condo in SG recently in SG in 2021,just before SG government increase the tax Levy into crazy rates for foreigner 🤣😅
This video was totally unserious for understanding the real reasons for Hong Kong’s housing problems.
The reason Hong Kong has a housing problem is that the HK government relies far to heavily upon property taxes, instead of income or consumption taxes, to finance its operations. High property taxes translate into high rents. Property Tycoons conspire with the government to keep property prices artificially high, resulting in high rents and a reliable government revenue stream.
Having low income taxes and no sales tax might be excellent for attracting business, but the HK government has to get its operating revenue from somewhere. If not from income or consumption taxes, then the revenue has to come from property taxes which are paid via rent revenue.
Also, since the wealth of the Tycoons exists in the form of land and buildings, it is in their interests to keep property prices high by restricting the sale of land for housing.
The MTR is another scam whereby the government sells undeveloped land to Tycoons at a relatively low price; these tycoons develop the property by adding the MTR and retail space thereby raising its value generating a profit stream, part of which is kicked back to the government in the form of property taxes paid for via users of the MTR and rent from tenants of the retail property.
So, the HK housing problem is a totally manufactured problem whereby wealth is extracted from the working class via rents and transferred to the tycoons and the HK government.
Singapore, a highly capitalist country, demonstrated how to develop an adequate supply of affordable housing for its citizens and still maintain a thriving business environment. It isn’t that difficult or complicated. But it does take political will. And it appears that the HK government and the property Tycoons lack that political will.
ok so instead of high rents you want people to pay high taxes which will deplete their income the same.
@@flakgun153
Singapore is a high income country at a similar stage in development. If Singapore-a highly capitalist country-can figure out affordable housing, Hong Kong should be able to do likewise.
The problem is not that Hong Kong can’t figure out affordable housing; the problem is that the property Tycoons and the government refuse to do what is required to solve this major problem.
Again, if Singapore can do it, HK should be able to do it.
@@jstasiak2262 HK has democracy and has regular elections ... BUT they seem not able to vote out a USELESS government at the ballot box. Democracy in HK is a SHAM, yet they are so proud of it. That's really SAD!
Exactly. It's not "poor" land management but corruption.
@@offiz when you have an election in Hong Kong, the only difference in the candidates, is one wears glasses, or their favourite colors are different, or how they gel their hair. That's it. They have abso-freakin-lutely identical political and loyalty directions. No one ever thinks differently, if you do, you're in BIIIIIIIG trouble.
Real estate is king and the de facto currency of Hong Kong, it is the best all- weather investment for 70 years. Without expensive real estate, it will not be today’s HK ..
Definitely a self-inflicted wound based on ideological laissez faire believes... One of the interviewee mentions HK has no money, HK has earns its own taxation, let's bring up the inevitable comparision, HK lost the plot, how is it Singapore could do it, and HK not do it better?
How old is Singapore? How old is Hong Kong?
@@archiehickox6518what? like 3.5billion years? c'mon , both are land scarce but who owns the majority of land (ans: govt), whom both attempted land recliamation (Singapore had to import sand no less), yet the policies of HK govt, create housing crisis where people lives in cages! Only benefit of the high housing cost may be to those whom chooses to leave!
Hong Kong is a nightmare city. Racism, discrimination and anti family environment make Hong Kong an unlivable city. Imagine working 6 days a week and only 1 week paid vacation per year.
Racism against whom? The city is 94% Chinese.
6 day work week is uncommon now. It was common in the 90s.
You are from a different planet@@canto_v12
you are talking about Canada right?
Nah, Racist Chinese Hong Kong@@vble2337
property values have lost an average of nearly 20% since 2 years ago. I knew this would happen. You can't sustain that kind of prices when you have over 100,000 high income expats and residents leaving the city.
HK’s financing model is fundamentally flawed… HK government collects very little taxes, so their only real source of revenue is from land sales… Why home prices in HK are the highest… on Earth! Like most other developed countries, HK government needs to start collecting more taxes!
Low corporation/income tax is a source of competitive advantage though, with raised taxes matching other countries, what competitive advantage does HK have?
@@Lambyyy there are definitely taxes which can be raised without hurting competitiveness. For example, the maximum salary tax can go from 15% to 20%, which is still lower than SG's maximum rate of 22% and much lower than global averages. Maybe a small tax of around 15% on imported wine and champagne, or raising the tax on tobacco. And stop wasting cash on the Lantau land reclamation. There are definitely things which can be done, it just takes political will.
no
Hong Kong is/was a lovely place. Would love to live there, but the housing prices are just crazy.
50 year leases?? It should be 25 like in Macau
HK became a financial ruin 😢
@@cowdudesupporter7063 yes
It's the British that make HK became a financial ruin.
There is almost nothing mentioned here about interest rates which the HK government doesn't actually control. The HKD is pegged to the USD so they have to follow the US set interest rate in order to maintain that. The high in 2021 occurred when US interest rates were almost zero making it very cheap to borrow. Immediately afterwards in early 2022 interest rates started to rise which naturally had a cooling effect on the property market. So even if they wanted to cool the market directly (and I don't believe they do when they get a huge amount of their revenue from land sales) their ability to do so is pretty limited compared with other countries
the developers who are hoarding land, should be taxed more for vacant land. & Tax should be calculated in its current estimated value.
Home prices crashing for 7 years and you still make articles saying things are too expensive... who is going to buy a place when next year it will be cheaper. HK has bigger problems than house prices.
Great content for a 2024 refresh of this topic
None of what was said here in the video or the comments are the real cause of housing crisis. There are enough houses and land for everyone in Hong Kong or any other city in the world. What caused the housing crisis across the world and will cause further crisis is that housing is available to purchase by everyone, specially housing investors. They are the one that pay more and buy homes that could be bought by one who wants to occupy those homes. Investors buy many homes and in some cases leave the home empty.
A person who wants to buy a home and move in will have to compete with numerous home investors who are rich and pay more and will eventually buy that home. They raise the demand for homes 2 or 3 times. The solution is to stop home investing. One person, one home. Then there will be no stress on housing market.
😂😂😂😂😂😂
@@archiehickox6518 What's so funny in the comment?
How many years have this been going on?
+/- more than a decade?
Have this video about HK's housing prices and many many other videos about HK's housing prices lower the prices of houses in HK?
4 decades.
That's what happens when you grant all the land to a single player, in this case the government, the government has a monopoly on housing in Hong Kong, of course it will be outstandingly expensive, all monopolies are.
Nope, the issue isn’t about the Goverment owning all the Land. It’s about knowing your piorities as a Goverment towards satisfiying the affordable Housing NEEDS of your OWN citizens FIRST. By Selling MORE Land to private PROFIT DRIVEN property developers, the prices will skyrocket leading to ONLY the Richest of the Rich could afford them…
There is a solution. Directly sell to citizens. There is no need for "property developers". Property developers can convert into construction companies that caters to each citizen as a customer. If everyone is profit driven, the weakest link will suffer.@@Callsign-Blade_RunnerSG
its basically like every other big city ...lots of people, buildings owned by investors
Move aside HK , Sydney is on the way to becoming the most unaffordable property prices in the world.
Poor government. The government is horrendous. Having citizens live in squalor is not okay.
2:20 For that price i could buy a two story terrace house with 4 Bedrooms buy two Mercedes for cash and and put the rest of the cash in a trust fund and live life jobless.
33mt2 for 1.2m usd
and theres nothing special in hk
50-year leases? Please tell me at that price HKers are not paying for just 50-year leaseholds. Are residential properties in HK freehold, 99-year leaseholds or 50-year leaseholds? At that average price of US$1.2mil.
Plot twist, I’m actually in Hong Kong travelling as a tourist, and I can confirm that it wasn’t exactly easy to find cheap accommodation either :P
Hong Kong citizens should look beyond their borders to own property, as Hong Kong real estate is unattainable for most. To live better, Hong Kongers need to think outside the box. If they desire a city like Hong Kong, Singapore is the best option. For a beach-like lifestyle, Thailand offers an ideal choice. For a slower and more laid-back pace, Malaysia is a suitable option. Instead of considering migration to Canada, the UK or US would be better choices if Western countries are being considered.
This is intentionally done to make the rich ( landlords) richer, and the poor continue to pay High taxes in land premiums. HK needs a huge supply of working / renting poor to serve the rich. By making property unaffordable- the poor are forced to work.
So people in countries with cheaper housing don't need to work? Not sure if I get your point.
我当年居住柴湾杏花村。2002年房屋价格触底。好像二十五万美元。房租八千五。离开以后却飙升。那个年代经济不景气。但是还没有大陆人进市场购房。今天是什么情况了呢？感觉经济不景气，但是比当年情况好些了吧。不同的是有大陆人支撑。但是今天还有政治因素。那个年代似乎没有。那个年代好像情况更稳定。今天高薪人士移民。市场大概平衡了各方面因素后集体定价。但是给予的定价会不会太高了一点。我的感觉是肯定的，即便自己看好当地前景。我以为这几年的展望明显逊色。放假应该反应了。却似乎没有。不过，我的假设不一定正确。我以为价格尚未从比较高的地位下滑。是不是？这个有些不寻常。为什么当年发现价格下滑。今天则不了呢？也许已经下滑了百分之五至十。那样的跌幅不够。因为之前升值了太多。或许我说的不对。就是根据大陆第一线城市的借鉴（？），香港不大跌也合理合情。因为在大陆第一线不降落。只有调节。第三线城市却实现大下滑。还是香港得到人们的肯定。我只是说，相对原先的地方氛围，今日的低迷情绪应该有相应的价格调整。其实，调低有积极作用。使青年买房能力提高，对接下来的市场正常运作有可好的面向。维持过高的水平反而产生不稳定。因为实际情况与人们的期待存在脱钩。有的人可能想干脆放盘房屋，移民。还是大陆人的价格支持妨碍市场的妥善调整了吧。目前价格比较稳定。不知道会不会有什么催化剂促进变化。拭目以待。
goverment is smart in the sense that more than 50% own private appartment. these 50% support high housing price.
should be "Why is Hong Kong housing STILL so expensive?"
No proper planning
Family should buy house with one bedroom one living hall. Then upgrade to larger house
Those prices are not so high considering that's how the government gets funding.
Remember people, income tax is very low and there is no VAT.
Same prob in Singapore.. 😢😢
it's goverment problem, blame it.
Ask Li-Ka-Shing who owns a lot of HK.
all the big cities are very expensive.
Singapore managed to get income from the accumulated wealth in its SWF for the past 50 years, thats why it can afford not to over-monetise land and burden the people. Its all about its revenue model. Should Singapore does not have its Reserve in SWF, it might need to squeeze more income from land. Management and vision is key.
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Honh Kong Real Housing Bubble just busted... Housing Market is in Busted mode.... in real price.
Theres always a conspiracy theory that they want to maintain the high land prices …
This report has a narrow scope on the housing market - and that one alone. Isn't it imaginable that a 45% drop in transactions and a 20% drop in prices over two years coincides with HK losing its freedoms? Who wants to live in an authoritarian city like that? There could be longterm trends here that your report isn't even touching on.
1000 square feet is 93m²
People from Hong Kong should consider immigration. It is so crowded in Hong Kong. Like they can even consider moving into China where there is more land and space for families.
They have no desire to live under CCP and Xi's rule.
5:14 " upholds the free market philosophy " absolutely nothing about not owning the land itself but only leasing it for 50 year's (70 in earlier transactions) upholds " free market " actuality and it's silly to even entertain that it ever could.
wonder what’s the occupancy rates
Not matter how modern a country is, it cannot provide the basic need of an affordable shelter , its time to pack and leave this country.
4:22 planning is important protecting environmental areas and waterways
Greening cities and restoring vegetation
You know the housing crisis in Melbourne had gotten bad when I just moved to hk and am finding it to be comparatively reasonably priced…
Maybe build housing on 10% or fringe areas of the massive country parks. Housing is THE paramount issue in HK, don't tell me about "environment" when people are homeless or living in coffins
Buy home in the UK
Just don't go.
Why does their chinese sound very different from those in China?
The problem is the same tax rate for everyone.
Artificial scarcity
Singapore builds more affordable housing for its citizens.
Glorified renters
Maybe the problem isn't that hard to solve.. just inept policy makers
Stunning china’s 🇨🇳city Hk ❤
the land auction is what afforded the govt low income tax and also no vat :)
ما فائدة الحياة اذا كنا سنجري لناكل ونشرب ليل نهار ليل نهار . الحياة حب ووئام مع الاهل ، صفاء الروح ، مساعدة الناس والعطف عليهم . عن نفسي لا ارى ان العيش في هذه المدن الكبرى لها فائدة غير الازمات النفسية التي يعيشها الانسان في هذه المنازل
or a clear demonstration on greed.
Same in the USA😢
The people of HK wants the property prices to be high. They take pride on that. That is what HK is known for....high prices. Can the HK government fix it? Sure, no problem. HK is practically a dictatorship now. The HK government can simply order a million new affordable homes to be built. No issues whatsoever, except, the HK government will not do that. If there are many new affordable homes, that will crash the property prices. A lot of people will be upset and go bankrupt. So the HK people and government will just talk talk talk talk....nothing will be done about it.
Just build more homes and infrastructure.
HK hardly has anymore land to build on.
Making house expensive is "the economy" of HK! That is the wealth of HK. If anyone makes housing affordable today HK will become Phlippines tomoorow! No governor of HK, be it from UK or locally elected, would dare to build enough houses to solve the problem.
Hong Kong people inspired me to do investing and trading. Thank you, Hong Kongers. You are great people.
Expensive everywhere end if story
Obviously. Ist development happened here. Tax free and most politicians and black money going into hongkong for buying flats from many ckuntries
HK is in demise, soon will have cheap sales.
So the land is sold on lease and the apartment is bought with life's savings 😂....well done 👍🏻
a few rich while the rest live in cages
Legacy of British colonial governing 🤣
How can u blame british
@@1pasupaty Not blaming, just stating the fact. And for decades from 60s to 80s, with short sighted government policies on housing development and favouring the rich developers, HK housing gotten worse.
since when HK housing market is not the world most unaffordable
Between the 1997 Asian Financial Crisis and the SARS epidemic in 2003, HK property prices actually crashed. I used to rent a 2 bedroom apartment in Sheung Wan, the building was completed in 2003 and my landlord paid just HKD 1.3 million. It's worth around HKD 8 million now though it peaked at around HKD 9 million in 2019. So yes, between 1997 and 2003, HK property was actually quite affordable, though very few people predicted that prices would skyrocket again so few people bought property at the low prices.
Incidentally, the property crash is also partially why Tung Chee-Hwa's 1997 plan to build 85,000 public housing units was killed off. Government revenue plunged while home owners feared that the flood of new housing supply would further lower the value of their homes.
More reclamation all the way to taiwan & singapore thru south cina sea 😅
Typical biased reporting from SCMP. A few things they seems to have conveniently omitted. First thing that comes to mind is the incredibly low income tax / no VAT in services and goods. What was also omitted was the stop of land sale is to protect existing home owners from losing a large portion of their life savings.
HK is a densely populated city, even more so than London, NYC. How about you show us how we compare comprehensively........
That is capitalist. Isnt we all love capitalist and hate communist? 😂
HK government monopolizes land. So not capitalist at all
ask china
China’s government owns all the land, and yet, the home ownership rate there is 90+%.@@tattletalestrangler8084
@@tattletalestrangler8084 it is if you think of the HK gov as running like a company
How's ☭ China's real estate market doing? Evergrande, Country Garden and Kaisa Group all doing well and completing projects on time? The CCP model was kicking farmers off their farm lands, auctioning those lands to private developers to make money because Beijing takes all taxes, leaving land auctions and fines as the primary source of revenue for local governments. ☭ model worked out so well, right?
Li Ka-shing did it😡
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I blame the Kumite. It draws too much attention and value to Hong Kong
Any time someone complains about a housing crisis, I show them Hong Kong lol.
Live in a 1 bedroom apartment for the price of a fking house.
If people are rich enough to afford these then its no problem
its ok, just give it time. All the rich HKer are leaving HK/.
Bz Hong Kong is chimese colony😂😂
Keep crying western bot😂
@@FrostKaiserI actually genuinely agree with you and finally some one who l found in the comment section that actually has a functioning brain for once
Your article was truly a delight to read! Your writing is clear and concise, and you possess a great talent for explaining complex ideas in a manner that's easy to understand. I also appreciate your approach of presenting both sides of the argument and encouraging readers to shape their own opinions. I'm excited to see more of your articles in the future!
Bot
hong kong is a lousy place to live for the lower income people
Anywhere in the world is alousy to live for the lower income people
@@darth.severuss that is where u are wrong
@@Tantemify I can't see where you are white (right).
@@darth.severuss cause u only live in your country and u never see the price and the housing other countries provide. such as singapore
HK was never meant for lower income people.
Seriously don't care. Carry on.
Why is Hong Kong housing so expensive ?
Oh ! That's because the British make the housing there expensive before they hand over Hong Kong back to China in 1997.
Check out housing in Shanghai and Beijing bot
China→Hong Kong →Singapore →Russia →Africa →ASEAN
🇹🇼 ❤
Thanks for looking at part of china
@@JonySmith-bb4gx we love pooh bear :)
Post colonial hangover. That’s why
Inherited from older older days
Because of communism ? 😅
exaxtly the opposite, HK people are suffering becaise of extrem capitalism
@@mobeyondI actually genuinely agree with you and finally some one who l found in the comment section that actually has a functioning brain for once
What a joke. I hope this issue is fixed soon. Can't believe something so small is worth soo much
Hong Kong crisis, next Singapore housings crisis. Collapse.
As a matter of fact, Singapore public housing has stabilised over the past 2 years. The government has tweaked the policy which weeds out non-serious buyers/investors and had in effect allow applicants who are in need of housing to benefit.
Application rate per unit has dropped (from 4.0 to 1.5 thereabout) and the average waiting period has shortened (4 years to 2 years). To show they meant business, enforcement has stepped and seized units that were bought but not occupied and later put up for sale.
The message is clear; public housing is for residential purpose and not for investment. And it works. As expected from the Singapore government.
Because of communism. Let's blame CCP. Easier. Democracy and capitalism can't do no wrong
during british rule, This problem wasn't there
Hong Kong’s system is literally different from China’s lol. That’s why it’s called “one country, two systems”.@@nicholasfooong.
@@themysteriouswanderer185 hk is run by beijing.
Yes, but Hong Kong is free market capitalist, while Beijing is socialist.@@nicholasfooong.
@@nicholasfooong. our former bris ma$ter provided us public housing and our current ma$ter gave us security ......