Car parks on move despite price gains

Hong Kong's economy has been on a recovery path since the pandemic gradually stabilized at the beginning of this year and that has driven the prices of car parking spaces up by between 1 and 18 percent at 15 housing estates in the first seven months. Compared to property prices,...

Staff reporter

Thursday, August 19, 2021

Hong Kong's economy has been on a recovery path since the pandemic gradually stabilized at the beginning of this year and that has driven the prices of car parking spaces up by between 1 and 18 percent at 15 housing estates in the first seven months.

Compared to property prices, parking spaces have relatively low entry barriers, making them targets for car owners and investors, people in the industry say.

The biggest price increase for parking spaces among all 15 housing estates this year was in La Cite Noble in Tseung Kwan O.

A space there sold last month for HK$1.8 million, its price up 18 percent from the beginning of the year.

Ken Lau, area director at Hong Kong Property, said the property market has performed well this year, especially in Tseung Kwan O, where multiple new high prices were recorded, making some investors more cautious about taking the plunge.

In contrast, prices for parking spaces in the same area still lagged behind.

Take La Cite Noble as an example. Despite gains, there was still room for prices of parking spaces to rise compared to all-time highs in 2018, which spurred investors into taking the plunge, further driving up prices, he added.

Parking spaces in indicative housing estate Caribbean Coast in Tung Chung also saw price increases. The latest transaction there was struck last month for HK$1.48 million, up 15 percent from HK$1.28 million in January.

Nelvin Ng, senior area sales manager of Midland, said prices for parking spaces in Tung Chung dropped from a high amid the pandemic and were sought after by car owners and investors as the Covid situation stabilized at the beginning of the year.

Ng said supply in the district was limited, with parking spaces to units in private residential buildings being in a 1:5 ratio.

City One Shatin, a blue-chip housing estate in the New Territories, has also seen a rebound in the prices of its parking spaces since the start of the year. The latest deal saw a space changed hands for about HK$1.18 million, 14 percent higher than a HK$1.03 million transaction done in January.

That was still 10 percent lower than its historic high of HK$1.4 million, and many investors were still entering the market, said Marco Yung, chief associate district manager of Midland.

He also pointed out that the government's cooling measures for industrial and commercial sales at the end of last year sent a positive message to the market and helped drive prices up.

In addition, Kingswood Villas in Tin Shui Wai, where car parking spaces were frequently traded, had also seen a significant increase in prices compared to the beginning of the year.

The latest transaction for a space saw a price jump of 13 percent to HK$1.35 million.

Many Wells Property executive director Ming Tse said the gradual easing of the pandemic had led to the release of pent-up purchasing power, resulting in an uptick in trading of residential houses, as well as their parking spaces.

He believes there is room for prices of car parking spaces to rise as they are still lower than the peak of HK$1.65 million.

He pointed out that the rental market for car parking spaces in estates was also hot. Most rentals were completed within two weeks of launch at prices between HK$3,200 and HK$3,400, or 2.5 percent per annum.