April 28, 2017 / 4:13 AM / a year ago

Hong Kong property prices hit record high for fifth straight month

HONG KONG, April 28 (Reuters) - Private home prices in Hong Kong, one of the least affordable places in the world, hit a record high for the fifth month in a row in March, extending its year-long price surge, according to government data released on Friday.

Cooling Hong Kong’s red-hot property market will be one of the top priorities for incoming leader Carrie Lam, who takes office in July and has vowed to tackle the city’s high housing costs.

Home prices in Hong Kong have jumped 364 percent since 2003, while the median monthly household income has risen just 61 percent, pushing home ownership out of reach for many.

In March, private home prices rose 2.07 percent compared to the previous month, while year-on-year prices soared 17.8 percent, according to an index compiled by the Rating and Valuation Department.

Lam has promised to keep expanding the city’s housing supply, continuing a tactic used by incumbent Chief Executive Leung Chun-ying.

The government on Friday said it expects the private market to provide some 96,000 units in the next three to four years, a record figure, according to the latest data released by the Transport and Housing Bureau.

But Lam’s task of making housing more affordable could founder on the bottomless pockets of mainland Chinese developers, who are bidding up the price of land.

Chinese companies successfully bid for six out of 27 plots of land sold by the government in the fiscal year starting April 2016, Lands Department data showed. But in money terms, they accounted for 44 percent of total transactions.

In the previous fiscal year, Chinese firms paid more on land deals than their Hong Kong competitors, taking up 55 percent of the value and nearly half of the land sold.

Reporting by Venus Wu; Editing by Randy Fabi

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