Luxury still costs the earth in HK

Business | Stella Zhai 17 Jan 2020

Hong Kong ranked the most expensive for premium goods and services among 28 cities globally, followed by Shanghai and Tokyo, Swiss bank Julius Baer found in its Global Wealth and Lifestyle Report 2020.

The report surveyed the price trends of luxury goods and services in the Julius Baer Lifestyle Index, which tracks 20 items across the 28 cities.

The index showed that Asia is the most expensive region for high-end consumption, whereas Europe is the least expensive.

Hong Kong ranked above 90 percent for residential property, beauty services, fine dining, business class flights and lawyer fees.

Richard Tang, head of research in Hong Kong, expects the price of small studios in the city to face the most pressure this year as property buyers switch to single-bedroom or two-bedroom homes, given a higher first-time mortgage limit and lower interest rates, and these could also drive up prices of flats priced below HK$10 million.

For units priced above HK$10 million, Tang said it depends on buyers' confidence in the local economy, as these owners generally hold more than one unit and are able to move to other countries. He forecasts Hong Kong will see 1 percent GDP growth this year.

Affluent consumers have shifted to a model favoring less waste, said Rajesh Manwani, head of markets and wealth management.

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