Are nano flats falling out of favour with Hong Kong buyers?
Tiny homes first to be hit by price slowdown, experts predict
Sliding home prices across Hong Kong may curb appetite for the city’s infamous nano homes, analysts predicted.
Property prices in the Chinese SAR have already slumped 6.3 percent from their peak in August, according to Centaline data, per Bloomberg.
New home sales in November were on track to be the lowest by volume since early 2016, according to Midland Realty.
“The rise and popularity of nano flats is largely centered around their relative affordability for buyers with limited budgets,” Denis Ma, head of research at Jones Lang LaSalle Inc, told Bloomberg.
“When housing prices start to sag, demand for these types of properties usually plummets as buyers turn their attention to larger units at the same price point.”
Historically, price drops hit small residential properties hardest in Hong Kong. During the 2015-2016 price correction, the cost of units smaller than 40 square metres sagged 12 percent, compared with just a 9 percent dip for those sized from 70 to 100 square metres, Bloomberg noted, citing government data.
More tiny homes are in the pipeline for the city, however.
Around 3,300 new nano flats measuring 19 square metres or less are due for completion from 2018 through 2020, an increase of 35 percent from the previous three-year period, JLL predicted.
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