MARKET WATCH Information from Cartus on Relocation and International Assignment Trends and Practices. SEPTEMBER 2017 Up-to-date information on the residential rental market, international schooling and visa/immigration regulations in Hong Kong HONG KONG PAGE 1 OF 2 CARTUS | MARKET WATCH: HONG KONG / SEPTEMBER 2017 | RESIDENTIAL LEASING MARKET In recent years, rental fees for small- and medium-sized properties have increased, while rental fees for large and/or luxury properties have decreased. However, the first quarter of 2017 bucked the trend as all property types saw rental fee increases. According to the Hong Kong government’s Rating and Valuation Department—Rental Indices, average rent by class recorded a 2% increase for Class A-C properties and a 1.1% increase for the larger Class D-E properties. Due to Hong Kong’s strong seller’s market, many landlords are opting to sell their properties rather than lease them, leading to limited stock and increased rental amounts. Properties priced between HK$30,000 and HK$80,000 remain popular among expatriates. However, a 3% to 5% increase has been forecast this year. Occupancy rates for properties in excess of HK$150,000 are slowly creeping up, although demand is not as high as their cheaper counterparts. With limited demand in this price range, it is expected that rent will, at least even out or show a small 1% to 2% increase. As a result, most companies have indicated no major plans to dramatically change assignee housing budgets. In lease renewal situations, landlords have remained aggressive. Rental reductions or even renewing at an existing rent are rare. Instead, average increases of 1% to 3% can be expected. Despite the Hong Kong government’s property cooling measures, which increased stamp duty tax on home purchases, it is expected that home prices will continue to increase due to strong domestic demand. Serviced Apartments/Hotels The recent opening of several new serviced apartments has increased supply. As a result, serviced apartment occupancy has dropped slightly, forcing landlords to offer promotional deals to boost sales. New serviced apartments: Little Tai Hang - 98 Tung Lo Wan Road, Tai Hang Opened at the beginning of 2017, offering studio, 1- and 2-bedroom units ranging in size from 358-810sqft. These are boutique-serviced apartments and hotels offering both daily and monthly stays. CM+ serviced apartments - 16 Connaught Road West, Sheung Wan Opened in Q4 2016, offering 54 deluxe studios (706sqft) with full harbor view. Beak Lane - 118 Queen’s Road West, Sheung Wan Opened in Q3 2016, offering 700sqft one-bedroom units. Low Range (HK$) Mid-Range (HK$) High Range (HK$) 1 Bedroom 17,000 – 30,000 25,000 – 48,000 55,000 – 80,000 2 Bedroom 22,000 – 40,000 35,000 – 80,000 75,000 – 120,000 3 Bedroom 40,000 – 60,000 65,000 – 100,000 110,000 – 170,000
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M A R K E T W A T C HInformation from Cartus on Relocation and International Assignment Trends and Practices.
S E P T E M B E R 2 0 1 7
Up-to-date information on the residential rental market, international schooling and visa/immigration regulations in Hong Kong
H O N G K O N G
P A G E 1 O F 2C A R T U S | M A R K E T W A T C H : H O N G K O N G / S E P T E M B E R 2 0 1 7 |
RES IDENT IAL LEAS ING MARKET In recent years, rental fees for small- and medium-sized properties have increased, while rental fees for large and/or luxury properties have decreased. However, the first quarter of 2017 bucked the trend as all property types saw rental fee increases.
According to the Hong Kong government’s Rating and Valuation Department—Rental Indices, average rent by class recorded a 2% increase for Class A-C properties and a 1.1% increase for the larger Class D-E properties.
Due to Hong Kong’s strong seller’s market, many landlords are opting to sell their properties rather than lease them, leading to limited stock and increased rental amounts.
Properties priced between HK$30,000 and HK$80,000 remain popular among expatriates. However, a 3% to 5% increase has been forecast this year.
Occupancy rates for properties in excess of HK$150,000 are slowly creeping up, although demand is not as high as their cheaper counterparts. With limited demand in this price range, it is expected that rent will, at least even out or show a small 1% to 2% increase. As a result, most companies have indicated no major plans to dramatically change assignee housing budgets.
In lease renewal situations, landlords have remained aggressive. Rental reductions or even renewing at an existing rent are rare. Instead, average increases of 1% to 3% can be expected.
Despite the Hong Kong government’s property cooling measures, which increased stamp duty tax on home purchases, it is expected that home prices will continue to increase due to strong domestic demand.
Serv i ced Apar tments /Hote l sThe recent opening of several new serviced apartments has increased supply. As a result, serviced apartment occupancy has dropped slightly, forcing landlords to offer promotional deals to boost sales.
New serviced apartments:Little Tai Hang - 98 Tung Lo Wan Road, Tai Hang Opened at the beginning of 2017, offering studio, 1- and 2-bedroom units ranging in size from 358-810sqft. These are boutique-serviced apartments and hotels offering both daily and monthly stays.
CM+ serviced apartments - 16 Connaught Road West, Sheung WanOpened in Q4 2016, offering 54 deluxe studios (706sqft) with full harbor view.
Beak Lane - 118 Queen’s Road West, Sheung WanOpened in Q3 2016, offering 700sqft one-bedroom units.
Low Range (HK$) Mid-Range (HK$) High Range (HK$)
1 Bedroom 17,000 – 30,000 25,000 – 48,000 55,000 – 80,000
2 Bedroom 22,000 – 40,000 35,000 – 80,000 75,000 – 120,000
3 Bedroom 40,000 – 60,000 65,000 – 100,000 110,000 – 170,000
H O N G K O N G
M A R K E T W A T C HInformation from Cartus on Relocation and International Assignment Trends and Practices.
S E P T E M B E R 2 0 1 7
IMMIGRAT ION 1) New Measure for Sponsoring CompaniesIn July 2016, the Hong Kong Immigration Department introduced a Declaration of Sponsor form (a compulsory form to be completed by sponsoring companies for new employment visas and change of sponsorship applications) to the immigration process. However in Q4 2016 the Department revised their process, removing the Declaration of Sponsor form and including extracts from it within an updated version of the Application for Employing Professionals in Hong Kong form. It is important to note, submission of the obsolete Declaration of Sponsor form will result in a rejected application; therefore we recommend any and all locally saved copies of this form be deleted going forward.
2) New Measure for Indian VisitorsEffective from 23 January 2017, Indian nationals who enter Hong Kong as visitors have to complete a pre-arrival registration (PAR) online. Upon approval, visitors using their visa-free entry can stay up to 14 days.
The PAR system requires travelers to answer questions regarding their travel history, contact information (in India and Hong Kong), amount of funds available, purpose of visit, and other questions. The system uses this information to conduct a risk assessment and instantly issues a printable approval slip if the traveler is accepted. Travelers have to bring the same passport and the PAR-issued approval slip to be able enter Hong Kong. The new policy will only impact Indian nationals entering Hong Kong as visitors. Indian nationals who have applied for a relevant employment or training visa will not be affected by the new policy.
3) Restricted Country RelaxationIn Q1 2017, Cambodia was removed from Hong Kong’s restricted country list for employment and training visas. Cambodian nationals are now eligible to apply for employment and training visas. They must fulfill the same eligibility criteria as other foreign applicants.
Vietnam has also been removed from Hong Kong’s restricted country list for training visas (note, restrictions still apply for employment visas).
P A G E 2 O F 2C A R T U S | M A R K E T W A T C H : H O N G K O N G / S E P T E M B E R 2 0 1 7 |
SCHOOLING Nord Anglia International School faces diff icult ies opening its second campusEarly this year, Nord Anglia International School (NAIS) announced that it will open its second campus in Tin Wan—Aberdeen, in August 2017. The school has been accepting students to its Tin Wan campus, however in late April, NAIS informed parents that they have been having difficulties getting the necessary permits from the Hong Kong government. As a result, the School has offered its students the option to attend their Lam Tin campus, which is the main campus, or withdraw with a full refund. NAIS has assured parents that it will continue to work with the Hong Kong government to resolve this issue.
New School Opening – Stamford American School Stamford American School (SAS) will start its first year at its Ho Man Tin campus this September. This year, the school will be providing programs from Kindergarten to Grade 7. Gradually, Stamford will expand its program offerings to Grade 12, making itself a “through-train” school. SAS will offer a U.S.-based curriculum, which adheres to American Education Reaches Out (AERO) and Common Core Plus standards. Once SAS acquires a high school, it will offer the International Baccalaureate Diploma Program for the last two academic years.
I n te r nat iona l Schoo l s Cos t Es t imate
Note:- The application and assessment fees quoted above are published
by various international schools in Hong Kong.- Some international schools require a mandatory individual
debenture, payable upon acceptance of a school place.Mandatory individual debentures range between HK$100,000 and HK$550,000. In this instance, no annual capital levy will be charged.
Exclusions:- School Bus Transportation, Books, Uniforms, Laboratory Equipment.
© 2017 Cartus Relocation Hong Kong Limited. All rights reserved. Cartus and the Cartus logo are pending or registered trademarks of Cartus Corporation.Sources: Ratings & Valuation Dept, Government of Hong Kong, Hong Kong Monetary Authority, Hongkongextras.com, Hong Kong Immigration Department.The information provided in this Market Watch publication is provided in good faith but is not intended to provide specific advice or to take the place of either written law or regulations. Cartus does not guarantee the accuracy or endorse any of the views or opinions given by any third parties and accepts no liability for the data and information included within.
www.cartus.com | [email protected] |
For further information about relocating to Hong Kong, contact [email protected].
Line Item Cost (HK$)
Application Fees 500 – 3,700 (non-refundable)
Assessment Fees 800 – 4,300 (non-refundable)
Annual Tuition Fees (Nursery to Year 13) 40,000 – 218,200
Annual Capital Levy 5,900 – 60,000
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