| MACAU, April 7
MACAU, April 7 As the world's gambling capital
Macau races to open more than 17,000 new hotel rooms over the
next three years to keep pace with a flood of Chinese visitors,
only about 4,000 affordable homes for locals are expected to be
built in the same period.
With an average apartment costing more than $500,000, the
Chinese special administrative region has emerged as one of the
world's costliest places to buy property, outranking
neighbouring Hong Kong, where prices are already among the most
expensive in the world.
Prices in Macau are forecast to rise 10-20 percent this year
and the situation looks set to worsen as Macau's new crop of
mega resorts open.
For residents like taxi driver Dengbao Xian, soaring
property prices mean the chance of owning a home in the former
Portuguese colony looks impossible.
"Buying a flat? Not a chance, even if you work for your
entire life," the 50 year-old lamented as he drove past the
glitzy front of MGM's metallic hued casino tower.
Population growth in the tiny territory, one-third the size
of Manhattan, is expected to jump 20 percent to 700,000 by 2016
according to government estimates.
"Four years ago you could buy a flat with 1 million patacas
($125,100). Now you can't even buy a parking space," said
Cherrie Choi, a sales director at realtor Centaline Property.
Some residents are choosing to buy in Hong Kong where
investment returns are twice that of Macau. Others are buying in
neighbouring Chinese provinces and some, like many retirees, are
giving up on the city and moving as far away as Thailand.
In March more than 400,000 people competed for 1,900
affordable housing units with locals lining up outside Macau's
public housing bureau at 4 a.m., local media reported.
"It's really the biggest problem in Macau. Right now the
rents and prices of flats have shot up way beyond people's
financial capabilities," said lawmaker Jose Coutinho, who
accuses the government of not doing enough to reverse the
situation due to its ties with tycoon developers.
Property prices have more than tripled since 2009, according
to data from the Macau government. The rise is in tandem with
Macau's gaming revenues, which last year totalled $45 billion,
nearly three times greater than Las Vegas, Australia and
Macau's economy relies on the gaming industry with gaming
taxes accounting for more than 80 percent of government
With unemployment at 1.7 percent, an estimated 40,000 new
workers will be required as new properties open over the next
three years, increasing demand for housing and exacerbating
tension among protectionist labour unions worried about job
Macau laws dictate only locals can work as dealers, and the
government is under pressure from residents who regularly take
to the streets to ensure these restrictions remain.
Analysts estimate new casinos opening in 2015-2017 will
require 12,600 new dealers, yet only about 700 are available per
A lack of a long-term plan for affordable housing is
widening inequality say lawmakers and property consultants, to
such a degree that even well-paid foreign executives in the
casino industry are finding Macau prohibitively expensive.
"I have great empathy for the local Macau residents," said
Linda Switzer, vice president of retail at MGM Macau, who
explained her monthly rent has jumped from a low of 8,000
patacas ($1,000) to 33,000 patacas in the seven years she has
lived in Macau.
Macau's government said it will continue to "be mindful" of
outside economic changes impacting the local property market and
deploy timely measures like increasing land supply and launching
public housing depending on the situation.
Two of Macau's largest property developers, Shun Tak
Holdings and Polytec Asset Holdings,
declined to comment for the story.
For now, new housing developments are limited to the luxury
segment with projects such as the Fountainside, featuring 3,000
square-foot villas and landscaped gardens, which are springing
up across Macau's crammed peninsula to cater to wealthy buyers
looking for a convenient place to park their gambling winnings.
With the majority of properties lying idle once purchased
and a lack of affordable housing projects in the pipeline,
locals are feeling increasingly marginalized.
"One of the sayings in Macau is that since I can't afford to
buy a house, I might as well buy a car," said Macau-based
political analyst Larry So.
($1 = 7.9910 Macau patacas)
(Editing by Matt Driskill)