Crazy housing prices
HAN AE-RANThe author is the head of the financial team of the JoongAng Ilbo.
“Actual size 721 square feet for HKD27.8 million.” “Actual size 1,282 square feet for HKD46 million.”
When I went to Hong Kong last August, I stopped to see the advertisements for apartment sales in a real estate agency. As I was not familiar with the Hong Kong dollar exchange rates and measurement system, I converted it.
The results were astounding. The small apartment of 721 square feet was for sale at 4.3 billion won ($3.6 million), and a mid-sized 1,282 square foot apartment was 7.2 billion won. They were not mansions with ocean views but ordinary units in downtown high-rise buildings. “I make USD10,000 per month but cannot afford to buy a home. Housing prices in Hong Kong are crazy.”
The Uber driver complained even before I asked. The driver, who seemed to be in his early 30s, repeatedly said “crazy” as the car drove by high-rise apartments along the harbor.
A Korean expatriate in Hong Kong said that there are newly married couples in Hong Kong who live with their parents separately because they could not afford a home together. When can they buy a home and live together? The answer was shocking. They can wait until one of their parents dies and inherit the house and then live together.
Recently, I read a posting on an online real estate community in Korea. Someone wrote that advice from a “master investor” turned out to be wrong. The investment master advised him “to have 3 billion won to give 1 billion won each to your children and prepare for retirement.” But “even if I give 1 billion won each to my child, they have to go to the outskirts of Seoul to buy a home, and I also need to sell my home and leave Seoul as well,” the author complained. He lamented that in the past, having 3 billion won in assets may be enough to prepare for a comfortable retirement, but now, it can only buy a Gangnam apartment.
What is the conclusion that the author wants to say? 3 billion won is not enough, so you should save up 6 billion won? Is it better to not have children when the housing price is crazy?
with the Korea JoongAng Daily
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