Microflats. When the focus is on affordability.
When the space is little
Once upon a time when I was in Hong Kong, I stayed in a small flat with just one room and it was not something I would feel comfortable with. In fact the shower room was so small that my good friend faced some difficulty locking the door when he showered. I did not remember the size but I do think it’s bigger than a car park space. A typical car park space is 8ft x 18ft = 144 sq ft. Now, let’s look at some facts of life with microflats in Hong Kong and also the question of affordability.
Article in bloomberg.com A doctor stays in a 220 sq ft space and says that, ‘It’s alright to live here alone.” There are around 8,500 of these tiny units in Hong Kong.
Home prices rose 187 percent from 2010 to 2019 because of critical shortage of homes. Now average home prices exceed $1.3 million (RM5.47 million) and the current minimum wage is just $4.82 (RM20.29) an hour.
Microflats, the tiniest are 128 sq ft.
Hong Kong’s topography also promotes the tendency toward small units. The mountainous landscape of its islands isn’t suitable for development, and 75% of the territory is green space or natural landscape, much of it in the form of protected country parks.
There is going to be a creation of Northern Metropolis with housing for 2.5 million people near the border with China. Home prices have risen 5 percent in 2021. Average cost of a nanoflat with less than 200 square feet rose to $3,276 per square foot in the first nine months of 2021, according to Midland Realty. The article is a long and comprehensive one. Please read it here: Article in bloomberg.com
My choice is to stay further away, not smaller places
If I am to choose between size vs distance, I would choose size anytime. Driving an extra 10 minutes away from any popular neighbourhood usually saves me easily 15-20 percent in property prices. In actual amount, easily 6-figure number. If I am willing to drive an extra 10 minutes away from this extra 10 minutes, I would be looking at even bigger space for even lesser money.
I am not alone yeah. Just look at the property transactions and everyone should realise that more transactions are at further away places and not the ones inside the city centre or even the ones surrounding the city centre. Perhaps when the choices are still aplenty, it’s best to grab a place. Upgrade later if possible, else, sell when we retire and use the money however we wish. Paying rental forever is certainly not a good option.
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