2022 property outlook: Super-size mansions, nano flats, and home offices round out the most important trends in Hong Kong's housing market

By Sandy Li

/ SCMP |

January 6, 2022 12:21 PM SGT

Overall view of the Cadenza luxury development in Kwu Tung by CSI Properties, on 16 November 2021. Photo Dickson Lee

SINGAPORE (EDGEPROP) - Hong Kong's transactions of new residential property may rise 15% next year as buyers continue their demand in every segment of the market from 138-square foot micro-apartments to 4,500-sq ft mansions on The Peak, according to one of the city's largest real estate agencies.

Up to HK$280 billion ($48.7 billion) of new homes may find buyers in 2022, marking the second year that annual transactions have risen, amid the bull run in the residential property market, according to Centaline Property Agency.

With only a few days left in 2021, home seekers are eagerly looking ahead to the housing market in the Year of the Tiger.

Here are five noteworthy trends for both buyers and sellers in 2022:

1) Mansions will go supersize to attract ultra-wealthy mainland Chinese buyers

A record 129 large, luxury apartments each costing more than HK$100 million were sold in 2021 for a combined HK$31.6 billion. Developers are building even more large homes to appeal to the ultra wealthy, especially those from mainland China, with the rapid development of the Greater Bay Area.

Kerry Properties has taken the lead with supersize homes in Kowloon. The luxury builder controlled by the Kuok family of the Shangri-La Group, will release three Mount Verra mansions each measuring more than 11,000 square feet (1,021 square metres) at Beacon Hill in Kowloon Tong, according to its latest plan, without disclosing the price of the homes.

General view of Mont Verra at 3 Lung Kui Road in Beacon Hill on 19 November 2021, featuring three mansions and 61 apartments. Photo: May Tse

In the New Territories, five 7,000-sq ft villas are on offer at the Cadenza project in Kwu Tung by CSI Properties.

Not to be outdone, K. Wah International Holdings and Chuang's Consortium are planning to build an eight-storey villa at 28 Po Shan Road at The Mid-Levels, with 44,388 s ft of space over eight floors, complete with a garden measuring 4,446 sq ft and another 2,197 sq ft on its roof terrace.

"The richest Chinese measure their wealth by the size of their residences in terms of mu," where each unit of the Chinese measurement for land size is equivalent to 7,176 square feet, said Vincent Cheung, managing director of Vincorn Consulting and Appraisal. "Houses of that size will appeal to the richest on the mainland."

A proposed eight-storey mansion at 28 Po Shan Road at The Mid-Levels in Hong Kong, developed by a venture between Chuang's Consortium and K. Wah International Holdings Limited. Photo: Chuang's Consortium International

The most over-the-top plan, on paper at least, may be the proposal by China Evergrande Group to build a cluster of 248 luxury villas at Wo Shang Wai near the Mai Po Wetlands in the New Territories.

The centrepiece of the project is a HK$4 billion mansion with eight bedrooms, four private lifts, gardens, a swimming pool and water displays, according to draft plans. At 240,000 sq ft, it will be as big as 180 of the biggest flats in Taikoo Shing, Hong Kong's most popular mass-market residential project, put together. Compared with the average living space of less than 200 sq ft for every resident in Hong Kong, the size of this single mansion is unprecedented.

Evergrande paid HK$4.2 billion (US$541 million) to convert the farmland into residential use. The company, which defaulted on an offshore bond while it grapples with more than US$300 billion of liabilities, was not available to say whether the Wo Shang Wai project would proceed.

China Evergrande Group's plan for a HK$4 billion mansion likened to the Palace of Versailles in Yuen Long, near Hong Kong's border with Shenzhen. Photo: Handout

2) Flats will become smaller to help local buyers get on the property ladder

With home prices hovering near records, young Hong Kong families, fresh graduates and first-time buyers have no choice but to opt for the smallest flats that require the smallest down payments to get on the property ladder.

"Flats in urban areas will be tiny, especially those redevelopment residential projects in the city centre," said Wong Leung-sing, senior associate director of research at Centaline.

Known variously as micro-apartments, nano flats, or shoebox homes, tiny abodes have been all the rage in Hong Kong ever since CK Asset Holdings set the trend in motion in 2014 when its Mont Vert project in Fanling sold out in a massive success. The smallest unit, at 165 sq ft, was available for HK$1.29 million after a 15 per cent discount.

Several projects have since followed, the most recent being Chun Wo Development's Soyo nano flats in Mong Kok, which measure between 152 sq ft and 228 sq ft, priced from HK$3.38 million to HK$5.95 million for an average of HK$24,179 per square foot. The developer had a taste of success in March when a 128-sq ft nano flat at its TPlus project in Tuen Mun sold for HK$2.35 million in the secondary market, a 52 per cent appreciation from its purchase price in 2019.

3) Covid-19 keeps people working from home, driving them further from office locations

Sino Land, one of the biggest developers in Hong Kong, said property buyers have become more tolerant of distances between their homes and the major office hubs ever since Covid-19 broke out in early 2020.

"We have clients who moved from Hong Kong Island to [Sino Land's new project] Silversands in Wu Kai Sha near Ma On Shan as they would like to live closer to nature," said the developer's associate director Victor Tin. "The trend will continue in 2022 as more companies adopt work-from-home arrangements, which alter the way people live. They don't mind moving further out for better air quality."

4) Builders add business centres to amenities to let customers work from home

The clubhouse at Sun Hung Kai Properties' St Martin development in Tai Po features stylish co-working space. The Townplace Soho serviced apartments on Caine Road by the same developer has what it calls "duo social space" indoor and outdoor communal areas that are designed to be work-friendly, featuring soundproof rooms for meetings and video conferences.

The recreational club at Sino Land's Grand Central development in Kwun Tong has private rooms for residents to hold team meetings.

"We have organised more health related activities for our residents and most of them drew a good response," said Tin.

St. Martin's clubhouse features stylish co-working space installed with desks and chairs that can serve as workstations as well as superb WiFi connection. Photo: SHKP

5) Narrowing price gap between New Territories and Kowloon

The suburban nature of the New Territories, close to mainland China's border with Hong Kong, has no longer a drawback for homebuyers, as new subway lines and stations in the area slash the commuting time with the major urban areas of Hong Kong Island and Kowloon, said JLL.

"New townships in the New Territories have enhanced the appeal of the region, most notably in retail offerings. Yoho Mall in Yuen Long is home to a number of international brands including American Eagle, Agnes b. and Aigle," said Nelson Wong, head of research at JLL in Greater China

Last week, Sun Hung Kai Properties released the first 206 units of The Yoho Hub residential project above the Yuen Long subway station at an average price of HK$19,899 per sq ft, about 18 per cent less than Soyo development in Mong Kok.

The price gap was 23 per cent last January when Hong Kong Ferry offered the first 112 units at Skypoint Royale in Tuen Mun for HK$15,020 per sq ft, compared Vanke released The Campton in Cheung Sha Wan for HK$19,511 per sq ft in the same month.

This article originally appeared in the South China Morning Post (SCMP), the most authoritative voice reporting on China and Asia for more than a century. For more SCMP stories, please explore the SCMP app or visit the SCMP's Facebook and Twitter pages. Copyright © 2022 South China Morning Post Publishers Ltd. All rights reserved.

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