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Is it still a good time to buy a small price property in HK for investment.

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  1. #31

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    The idiot who bought the most expensive chi fu apartment in '97 is up about 30% now.
    The idiot who bought the most expensive apartment at royal palms in '97 is down 50%.
    The idiot who bought the 3 repulsebay rd apartments in '97 is up almost 100%.


  2. #32

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    Original Post Deleted
    Ah, yeah, except that The Hang Seng Property Index has risen 29 per cent this year, compared with the 13 per cent advance in the Hang Seng Index. So more than double. And with just say, 50% leverage in property vs stocks, that's more than quadruple ...

  3. #33

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    The Economist views HK Property as 64% overvalued as of August (highest globally).
    Last edited by jw1701; 04-10-2012 at 09:14 AM.

  4. #34

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    I have explained many many times, as have others, why this survey is fundamentally flawed.

    Just a few reasons:

    It does not take into account tax rates.

    It does not take into account costs paid on interest vs cost to rent.

    It does not take into account long term interest rate outlook.

    It does not take into account the absence of a capital gains tax upon sale realising a profit.

    I could go on, but I have explained before, based on my valuations HK property is around 30% undervalued.

    I have also said before, I will post here and advise when I think HK property has hit fair value.


  5. #35

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    would not all these factors make any calculation so messy and irrelevant to most people that this is exactly why they've avoided it?

    ie look at these figures as the overall market situation THEN factor in your personal tax rates, mortgage rate etc

    exactly what i did - and you're right it does make HK more affordable for me compared to say Australia with a higher cost of living but really not that much difference certainly not 64 vs -30!!


  6. #36

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    "30% undervalued" is only a temporary situation. When interest rates rise, prices can quickly change to "30% overvalued". The question is when interest rates rise and whether you can cash out before they do.

    One also has to realise that when the market peaks, the price indicators could be backed by only very low numbers of actual transactions. e.g. seeing someone selling at, say, $10,000 psf does not mean that you could sell also sell at that price and when volumes evaporate, you might be lucky to get $9,000.

    Last edited by DarrenChan; 04-10-2012 at 10:33 AM.

  7. #37

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    I do not believe in buying a small property in all areas. Whether I think the market is up, down, sideways, going down, going up, there are areas and types of property I am just not interested in. So if you ask me do I want to buy a property in NT my answer is no. If you ask me do I want to buy an apartment in Kowloon, well maybe 40-60. If you ask me do I want to buy anywhere on the tram route, then I am interested. If I was a HKD cash buyer I would be looking. Access to a 2.15% mortgage, yes interested. On the other hand if my cash was not in HKD I might be asking myself if the $US is going to seriously correct in value. Then I might wait or at least be more picky.


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