Demand for Tiny Apartments in Hong Kong Jumps 52%

(Bloomberg) -- In order to get on the property ladder in the world’s least affordable housing market, home buyers in Hong Kong are going ever smaller -- now looking into apartments that are tinier than two parking spaces.

Residential units no larger than 300 square feet (27.9 square meters) saw a 52 percent jump in transaction volumes year-on-year in the first eight months of 2018, data from agency Ricacorp Properties show. Such dwellings now comprise 12.4 percent of total apartment sales in the city, up from 9.3 percent last year.

“The rise in property prices has made it difficult for people with less purchasing power to buy a home,” Buggle Lau, chief analyst at Midland Realty, said. “So potential home buyers look for low lump-sum prices rather than a low price-per-square foot.”

Home prices in Hong Kong have increased by 14 percent this year, according to the Centaline Property Centa-City Leading Index.

The rise in demand for super small is also a result of shrinking family sizes, said Wong Leung-Sing, a senior associate director of research at Centaline Property Agency.

“The number of one-person families in Hong Kong has been growing rapidly,” he said. “For those who live alone, why do they need that much space?”

©2018 Bloomberg L.P.