This pushed rents up, with Mid-levels rising the fastest at 0.6%.
A growing number of new expats in Hong Kong continue to stimulate demand for luxury rental accommodations as year-end rents rose in traditional luxury areas, according to Colliers quarterly residential report.
Mid-levels registered the highest level of year-end leasing activity as rents rose at the fastest rate of 0.6% QoQ whilst rents for Southside and The Peak remained flat.
The surge in housing demand may be due to the fact that rents have become more negotiable especially for houses which have been vacant for several months, Colliers adds.
“As leasing demand for ultra-luxury units and townhouses remains relatively soft, we expect the rental outlook for luxury apartments in Mid-levels to be the most resilient. Southside will be supported by the growth of apartments, while the Peak should see the most moderate growth,” added Tang.
Tang also noted that more expatriates are opting to lease outside of traditional luxury districts like Island East amidst changing corporate policies and rising rent levels.
Ironically, even as expats move away from core districts to avoid costlier homes, the surge in demand has actually driven rents to rise faster outside traditional districts with the report noting that the rental difference between Island East and traditional luxury residential areas has narrowed from 37% in 2012 to 15% in 2017.
Moving forward, the upcoming establishment of international school campuses in Kowloon and New Territories as well as continued improvements to overall living and conveniences is likely to become popular with expats looking to settle down in the coming years.
Photo from Daniel Case - Own work, CC BY-SA 3.0
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