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Hong Kong Property market - still a good buy?

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  1. #11

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    Why do you think he's so rich? He works when others are sleeping, partying around.

    The doomsdays sayers have been saying the same thing for the last 3 years and they will keep on saying it until one day they are right.

  2. #12

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    More good news for the HK property market, exactly as I had been saying...

    The Federal Reserve today indicated it would keep cash cheap and easy for at least two more years, and a bold statement that the Fed stands ready to enact further stimulus measures if needed.

    Interest rates in the US, and how this affects rates in HK: The Fed indicated it plans to keep "exceptionally low" interest rates in place until at least mid-2013 as a way to continue to prop up the recovery. They hope that low rates will encourage spending by making it cheaper to borrow money.
    The HKD peg to the USD means that rates will follow suit in HK. Ever after mid 2013, I would think rates will only very slowly increase.

    As I have continuously argued on the threads here related to property prices in HK, the Fed's actions will mean that rates stay super-low in HK. The Feds's new statement (and any possibly further stimulus) will continue to push HK property prices significantly higher, as it makes borrowing increadibly cheap. HK property remains an excellent way to benefit from the economic problems in the US, and to protect one's HKD's from a decline in value.


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  4. #14

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    Quote Originally Posted by randy1:
    More good news for the HK property market, exactly as I had been saying...

    The Federal Reserve today indicated it would keep cash cheap and easy for at least two more years, and a bold statement that the Fed stands ready to enact further stimulus measures if needed.

    Interest rates in the US, and how this affects rates in HK: The Fed indicated it plans to keep "exceptionally low" interest rates in place until at least mid-2013 as a way to continue to prop up the recovery. They hope that low rates will encourage spending by making it cheaper to borrow money.
    The HKD peg to the USD means that rates will follow suit in HK. Ever after mid 2013, I would think rates will only very slowly increase.

    As I have continuously argued on the threads here related to property prices in HK, the Fed's actions will mean that rates stay super-low in HK. The Feds's new statement (and any possibly further stimulus) will continue to push HK property prices significantly higher, as it makes borrowing increadibly cheap. HK property remains an excellent way to benefit from the economic problems in the US, and to protect one's HKD's from a decline in value.
    So you think buy now, sell in two years?

    Sent from my GT-P1000 using GeoClicks Mobile

  5. #15

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    Of course! - what do you expect, when you try to sell a $700,000,000+ asset, right during the middle of a possible 2008-style sell-off. The buyers got a great price on this land.

    HK property prices also fell in the middle of the 2008 panic, before the upward trend continued. Same with the AUD, oil, commodities, etc. In a time of panic, people move into cash, and reduce leverage etc. But thereafter, if more money is printed and as confidence returns, the cash needs to find a new home, and asset prices inflate to new highs. Which is what will happen with HK property.

  6. #16

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    I'm certainly impressed by your optimism! I just wonder when it will be that regardless of how cheap it is to borrow, people will start saying, no, I just cannot pay that for a small apartment, house etc.


  7. #17

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    Quote Originally Posted by luckycat:
    So you think buy now, sell in two years?

    Sent from my GT-P1000 using GeoClicks Mobile
    Yes, by all means, if you can use this current panic to push for a good purchase price, I think its a good idea to buy now. Things might seem expensive now, but they will likely seem an awful lot more expensive in a few years from now.

    Low interest rates, a stable rental income, limited supply, a falling USD (which the HKD is pegged to).

    As for selling, yes in two years from now, I think its likely that prices will likely be higher than they are now.

    The main issue for HK property buyers right now is leverage.

    Right now, most banks will only give you 50% or so financing, so for some people, it may be tough to get better leverage or come up with the required deposit.

    The good news though, is that if you do get in now, prices will only continue to increase if/when the HKMA relaxes lending policies to something more normal where a smaller deposit is required. That will likely start around 2013 and and when the Fed ever starts to increase rates.

  8. #18

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    "Happy to pay" might not be exactly the right term - "willing to pay" is probably more accurate. The reason why prices are what they are, is indeed due to people's willingness to pay. People are obviously very willing to pay what they are paying, which is why prices are the level they are at.

    So, what you need to look at, is how the Fed's actions will affect people's willingness to pay. And I think you know the answer - more money, more liquidity, a falling USD and low rates will INCREASE people's willingness to pay. Which will lead to ... RISING PRICES.

    That is the big picture, and often in investment decisions, if you can see and understand the big picture, and act accordingly, you can make easy money.

    On your point about whether HK Govt policy can affect property prices, the answer is yes of course policy can have an effect. So, what do you think the HK Govt, and those in power in HK want? They want stable, reliable property price increases. So, they will make sure that HK policy achieves this. How can the "common man" benefit from this? Easy - buy property.

  9. #19

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    Quote Originally Posted by randy1:
    How can the "common man" benefit from this? Easy - buy property.
    The common man would never be able to afford a deposit so don't post stupid quotes. End of day all this hoo ha will mean dick if HK$ depegs and the pressure is very much on with this particularly with our real leaders, the property and shipping magnates.

  10. #20

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    So let me ask you this. Do you find the rents in HK reasonable? And if not, why do you continue to pay them?

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