‘New way of life’: pandemic shifts investor preferences in Hong Kong, New York luxury property market The Covid-19 pandemic is ushering in a common trend in the luxury real estate market among prospective buyers in Hong Kong and abroad.
In Hong Kong, inquiries for property in Clear Water Bay on the eastern side of New Territories have tripled since January. In Paris, some prospective buyers have included an outdoor area as a requirement, while the New York suburbs of North and Central New Jersey and Hudson Valley are gaining popularity. These preferences point to a common thread. Empowered by a work-from-home regime, well-to-do buyers are keen to bypass city centres in search of bigger space to practise social distancing and move closer to nature, according to agents.
“We have witnessed a return of the rural buyer, as the great social experiment of working remotely has been a success,” said Roseanne De Vere Hunt, agent at Sherry Fitzgerald Country Homes, affiliate of Christie’s International Real Estate. “Buyers are now looking for a lifestyle change, given that they can now work from home,” she added. “This gives a better work-life balance as they look for green space, close to water, low density, privacy and seclusion.”
The pandemic has underscored the appeal of having an outdoor area as people work from home, sometimes for months, under government lockdown rules to stem the Covid-19 disease. More so for Hongkongers, whose city is ranked among the world’s most congested. “Most recently, more buyers and renters are looking for houses with terraces or gardens, especially in suburban locations,” said Koh Keng-shing at Landscope, another Christie’s affiliate. “Since January, we have received three times more inquiries on Clear Water Bay.”
A stand-alone house in New Territories can be bought for HK$30,000 (US$3,869) per square foot, about one-third of the price in traditional upscale spots like the Peak, Kowloon Tong, and Ho Man Tin, according to Thomas Lam, executive director and head of valuation and advisory at Knight Frank. Capital appreciation in such property has tripled in the past 10 years.
The Hong Kong-based clients of the representative office of French lender Banque Transatlantique have also inquired about homes in Paris’ suburbs, as well as in cities such as Lyon and Marseilles. “It could be a new way of life, finally,” managing director Hervé Guinebert said. “Because of the lockdown in France, in general, people will look for more spaces and greenery. Living in the suburbs could be a good option.” Working from home is turning into a big trend, he added. The bank’s headquarters in Paris, for example, have allowed about 70 per cent of its staff to work remotely until at least September, he said.
In France, about a quarter of 902 prospects surveyed by Paris agency Daniel Féau & Belles demeures de France in May have changed their requirements for a home to include an outdoor area. Before the lockdown, Paris and its western suburbs were in great demand. High prices in Paris have also pushed buyers to scout for similar assets in cities like Lyon for better quality of life, said Alexandre Allard-Latour, agent at Coldwell Banker Cobalym Properties.
In Hong Kong, Sino Land is trying to capture the shifting trend. Last February, it launched a 33-unit development known as 133 Portofino in Sai Kung, a district in New Territories. Two units have been sold by tender for HK$28.8 million and HK$38 million. It is the first residential project in the city to receive the Core V.2 accreditation by the International WELL Building Institute, a badge for incorporating human health and wellness in projects to improve sustainability. “As we spend more than 90 per cent of our time indoors, the built environment has a profound impact on our health, well-being and productivity,” said Daryl Ng, deputy chairman of Sino Group. The accreditation means it has endeavoured to provide a healthy lifestyle to residents, he added.