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Friday, July 8, 2016, 15:55

Prime rental properties down 5% in HK

By Luo Weiteng
Prime rental properties down 5% in HK
Two International Finance Centre (IFC), front second left, and other commercial and residential buildings standing on Hong Kong island are seen from the Tsim Sha Tsui district of Hong Kong, China, on June 20, 2015. (Photo by Xaume Olleros / Bloomberg)

HONG KONG - Prime rental properties in Hong Kong posted an annual 5.2 percent drop in the 12 months ended March 2016. Analysts see no signs of recovery, projecting the losses to extend to 8 percent for the whole of 2016.

According to the latest prime global rental index released by London-based consultancy Knight Frank, some 11 out of the 17 cities tracked by the index have recorded flat or declining prime rents over the past year through March.

Among them, Hong Kong only fared better than Nairobi, Kenya, which registered the biggest fall of as much as 7.9 percent.

"The slowdown in expatriates’ demand for prime rental properties and the unclear global economic prospects would place more downward pressures on the luxury rental market in Hong Kong,” said David Ji, director of research and consultancy for Greater China at Knight Frank.

For the first five months this year, the luxury rental market has seen a decrease of 5 percent. Such a downward trajectory could expand to 8-percent losses by year end, Ji noted.

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