Despite efforts to cool Hong Kong’s astronomical housing prices, the city’s real estate moguls are still raking it in.
Property billionaires account for nine out of 10 of the city’s richest people, according to Bloomberg, and they haven’t missed a beat since November, when the city imposed higher taxes in an effort to tame the market.
The city’s property billionaires saw their collective fortunes soar 19 percent over the last four years, Bloomberg found. And the Hang Hang Seng Properties Index grew at 10 times the pace of the broader index.
In November, city officials introduced a stamp duty hike in an attempt to curb Hong Kong’s high real estate prices. But while eight of the city’s 10 richest people lost more than $4.4 billion, initially, they have recouped those losses.
Over the past few years, Hong Kong real estate prices have soared, despite the efforts of the city’s current chief executive, Leung Chun-ying. In the current election year, the two leading candidates have both cited unaffordable housing as an issue they want to address.
Since November, developers haven’t missed a beat at new apartment buildings — where crowds have been lining up to cash in on discounts and rebates.
“The rich are inconvenienced by it, but it’s the middle class that are hurt the most,” Peter Churchouse, the managing director of Portwood Capital, told Bloomberg. “It makes selling in the secondary market extremely difficult because buyers have to pay the tax up front, whereas the payments are deferred in the pre-sales market.” [Bloomberg] — E.B. Solomont