The Philippine Star

Prop­erty in­vestors turn to SE Asia amid HK un­rest

- Sweden · Asia · Hong Kong · Singapore · China · United States of America · Penang · Malaysia · Beijing · Luxury Living

From lux­ury Sin­ga­pore apart­ments to Malaysian seafront con­dos, Hong Kong in­vestors are shift­ing cash into South­east Asian prop­erty, de­mor­al­ized by in­creas­ingly vi­o­lent protests as well as the China-US trade war.

Mil­lions have taken to the streets dur­ing four months of pro-democ­racy demon­stra­tions in the south­ern Chi­nese city, ham­mer­ing tourism while also forc­ing busi­nesses to lay off staff – and the prop­erty sec­tor is feel­ing the pain.

Prop­erty stocks in one of the world’s most ex­pen­sive hous­ing mar­kets have plum­meted since June, with de­vel­op­ers be­ing forced to of­fer dis­counts on new projects and cut­ting of­fice rents.

Hong Kong busi­ness­man Peter Ng bought a con­do­minium on the Malaysian is­land of Pe­nang – which has a sub­stan­tial eth­nic Chi­nese pop­u­la­tion and is pop­u­lar among Hong Kongers – af­ter the protests erupted.

“The in­sta­bil­ity was a cat­a­lyst for me,” the 48-year-old stock mar­ket and prop­erty in­vestor told AFP, ad­ding he was wor­ried about long-term dam­age to the Hong Kong econ­omy if the un­rest per­sists.

“In­vestors will al­ways look at things like that, po­lit­i­cal sta­bil­ity.”

And Derek Lee, a Hong Kong busi­ness­man who owns a Pe­nang apart­ment, said he knew oth­ers in the semi-au­ton­o­mous city who were con­sid­er­ing in­vest­ing in South­east Asian prop­erty be­cause of the un­rest.

“Peo­ple are think­ing about how to quicken their ideas, how to make a more sta­ble life,” the 55-year-old told AFP.

Ad­ding to the al­lure of Malaysia is its rel­a­tive af­ford­abil­ity and prices much lower than Hong Kong.

The Malaysia site of South­east Asian real es­tate plat­form Prop­erty Guru has seen a 35 per­cent in­crease in vis­its from Hong Kong, ac­cord­ing to its CEO Hari Kr­ish­nan.

While Hong Kong’s protests are pri­mar­ily push­ing for greater demo­cratic free­doms and po­lice ac­count­abil­ity, the sum­mer of rage has been fu­elled by years of sim­mer­ing anger to­wards Bei­jing and the lo­cal gov­ern­ment over fall­ing liv­ing stan­dards and the high costs of liv­ing.

Hong Kong’s prop­erty mar­ket is one of least af­ford­able in the world with sky-high prices fu­elled, in part, by wealthy main­lan­ders snap­ping up in­vest­ments in a city which has failed for years to build enough flats to meet de­mand.

But now main­land Chi­nese, who tra­di­tion­ally viewed prop­erty in Hong Kong as a safe in­vest­ment, are opt­ing for ri­val fi­nan­cial hub Sin­ga­pore as a re­sult of the protests and the US-China trade war, ac­cord­ing to ob­servers.

There has been a jump this year in sales of lux­ury apart­ments in the city-state – which like Hong Kong is known for pricey prop­erty – driven par­tially by main­land Chi­nese buy­ers, ac­cord­ing to the con­sul­tancy OrangeTee & Tie.

“The protests in Hong Kong have made some of the (main­land Chi­nese) based there... (more con­cerned) about in­vest­ing in Hong Kong real es­tate, so they carry that in­vest­ment to Sin­ga­pore,” said Alan Cheong, ex­ec­u­tive di­rec­tor of the re­search and con­sul­tancy team at Sav­ills.

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