Hong Kong home hunters are feeling the squeeze, with more than eight times as many micro flats built in the city in 2017 as there were five years ago, according to new data.
Last year, 691 private flats of less than 20 square metres, or about 206 square feet, were completed. And those so-called shoebox homes accounted for about 4 per cent of the 17,791 private residential units completed in the year, according to figures released to legislators on Monday. In 2016, only 206 such flats were completed, or 1.4 per cent of the year’s total.
The same data, from the Transport and Housing Bureau, showed only 1 per cent of the 8,254 private flats completed in 2013, or 81 units, were so small.
Back in 2012, such small flats did not exist. But one legislator said they were getting more popular because general buyers could still afford them, amid rising prices.
Legislator Wilson Or Chong-shing, housing spokesman for the pro-government party Democratic Alliance for the Betterment and Progress of Hong Kong, said: “This can’t be right and definitely deserves the government’s attention.”
Or urged the government to step up efforts to boost land supply. “There has been all talk and no action,” he said. “And that government task force has seemingly degenerated into a talking shop.”
He was referring to the government-appointed Task Force on Land Supply, expected to release its report later this month for public consultation, after months of discussion on ways the administration can free up land to boost home construction and ease price rises.
But Wong Leung-sing, associate director of research at the property consultancy firm Centaline, said the boom in nano flats was not an issue.
“Many young people want to live independently and they prefer smaller flats,” Wong said. “Hong Kong is a free market. If those nano flats were not popular, no developer would be able to build them for sale.”
Wong said he expected developers to build more nano flats in the next few years.
“After all, we are only talking about 690-something nano flats last year,” he added.
Home prices in Hong Kong rose for the 22nd consecutive month in January, with the price index soaring to a record 357.5, according to the Rating and Valuation Department, which calculates it.
Even flats sold under the government-subsidised Home Ownership Scheme – at a 30 per cent discount to the market rate – have recently sold at close to HK$10,000 (US$1,270) per square foot.
Based on the average house price and the city’s median monthly salary of HK$17,200, the average wage earner needs 30 years’ worth of monthly income to afford an average 600 sq ft flat, which could cost HK$6 million.
In March, a 209 sq ft flat at a private project in Pok Fu Lam sold for HK$7.86 million, or HK$37,651 per square foot, a record for a nano flat in the city.