Hong Kong chases Singapore

Hong Kong chases Singapore

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If mortgage approvals are any bench mark, Hong Kong’s already fast paced economy is about to get another shot in the arm. Approvals last month reached their highest level in ten years. This November, saw a rise of 76% over last year’s new mortgages, lending over $3 billion US.

Hong Kong seems desperate to overtake Singapore as the leading market in Asia with the recent announcement of an agreement with India to let airlines double the number of flights to larger Indian cities, specifically Mumbai and New Delhi, and open more routes to Europe and the United States. Hong Kong has also agreed to increase capacity between the mainland and the Island by removing flight restrictions. These new routes should be open by the third quarter 2008.

Some pundits are predicting price rises in the residential property market in the order or 25% – Raymond Ngai, an analyst at J.P. Morgan one of them.

Certainly Hong Kong’s connection to U.S. interest rates is fueling the boom along with the fact that many property developers have delayed projects in the hope of a better climate in 2008.

Hong Kong has seen solid sustainable growth over the last ten years and combined with the current low interest rate, perhaps they will manage to overtake Moscow as the Most expensive county in the World.

In a recent cost of living report by property consultants, Mercer, Hong Kong managed a lowly fifth place behind in descending order – Moscow, London, Seoul, and Tokyo.

The report is available here.