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Life in Hong Kong Is Harder Than Ever - Unless You're a Tycoon

P

ponpo

( ≖‿≖)
https://www.bloomberg.com/news/arti...-tycoon-life-in-hong-kong-is-harder-than-ever

Mrs. Lau can't help but glance nervously at the calendar. Her next paycheck isn't for a week, and she doesn't have enough money to feed her family of four crammed into her small, government-subsidized Hong Kong apartment. Her husband can't work, and the kids don't understand why their mother keeps buying stale food.
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It's an increasingly familiar tale in Hong Kong, a city of soaring skyscrapers and glittering luxury boutiques that's become perhaps the epitome of income inequality in the developed world. Two decades after Britain handed the former colony over to China, its richest citizens -- billionaires such as Li Ka-shing and Lee Shau Kee -- are thriving, thanks to surging real estate prices and their oligopolistic control over the city's retail outlets, utilities, telecommunications and ports. But not people like Lau.
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"Hong Kong is an incredibly extreme case of unmitigated inequality, with very little in place to stop it," said Richard Florida, author of "The New Urban Crisis" and a director at the Martin Prosperity Institute in Toronto. "I don't see it as being sustainable. It's not the economics, it's the political backlash. It generates a backlash, and people just get angry eventually."

Hong Kong's struggle to help its citizens improve their lives may represent the greatest challenge to its unique economic model. The city has been lionized for decades by some economists as the closest thing to a free economy, with few regulations of any kind, and no retail sales or capital gains taxes. More than half of Hong Kong's working population, including Lau, live below the level at which they must pay income tax -- and for the minority who do, the standard rate is a low 15 percent.
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In some respects, Hong Kong is experiencing a turbo-charged version of the growing divide evident elsewhere. Formerly remunerative manufacturing jobs -- Hong Kong used to be the world's toy-making capital -- have vanished, replaced at one end of the spectrum by highly paid bankers and at the other by low-wage waiters and floor sweepers.
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Debates about Hong Kong's rich and poor tend to come back to one word: land. Housing is the least affordable in the world, according to housing-policy think tank Demographia, with median prices relative to incomes far outstripping those of Sydney, London and San Francisco. Home prices have risen nearly 400 percent since a real estate slump ended 14 years ago.
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For the middle class, developers have been building an increasing number of micro-apartments, the smallest just 128 square feet, with price tags of more than $400,000.
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-1x-1.png
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The assets of the 10 wealthiest people now equal 47 percent of Hong Kong's economy, according to the Bloomberg Billionaires Index.
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Hong Kong continues to construct subsidized apartments. More than 2 million people out of 7 million-plus live in public rental housing paying an average $220 a month. Typically in outlying areas, they feature rows of identical towers of 50 stories or more -- hardly luxurious, but modern and relatively affordable. Still, waiting times can stretch nearly five years.
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With living standards lagging behind rising costs, some Hong Kong citizens have begun to wonder what was once unthinkable: whether folks across the border in mainland China might be better off. Take Yu Wen-mei, 61. She started working in a garment factory in the 1970s and recalls ferrying food and appliances to grateful relatives in Guangdong province in the 1980s. As low-end manufacturing disappeared, she took a job in a Motorola plant, which closed in 2000. She's a mall security guard now, earning minimum wage.

"Now, they have everything," she said of her mainland relatives.
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T

TheWraith

Member
Hong Kong is basically effed as the status quo is in place by the Beijing-backed tycoon government, which keeps prices for housing, transport, goods,... artificially high as these companies are basically part of the government and run monopolies on everything.

If you protest to finally democratically elect the government to have some change, people are branded criminals, terrorists or indepedence activists or a mix thereof.

It's only going to get worse. The UK and China's handover deal basically ruined this place's long term prospects.
 
Ozzy Onya A2Z

Ozzy Onya A2Z

Member
Horrible, I'm not sure a viable solution for this inequality, anywhere in the world, has been brainstormed or put into effective practice yet. My wife and I were lucky enough to jump into Melbourne, Australia real estate before the big series of increasing values hit. We started saving for our kids to afford houses the day they were born as we realise it's a massive uphill battle to buy into anything with a reasonable travel time for work etc. As for HK families I feel for them big time, no one should have to feel lost just to feed their families.
 
S

SRG01

Member
My sister is about to be hit by this. Most of her co-workers already lost their jobs, and she's one of the few part timers left.

She's lucky that her husband commutes to the mainland for work. It's pretty much how a lot of people in HK make a living.
 
Nikodemos

Nikodemos

Member
I'm pretty certain Beijing is doing this in order to force people out of Hong Kong proper and into the mainland where they are a) easier to control/watch over; b) dispersed into the larger mass of mainlanders who either like or are indifferent to the government.
 
T

travisbickle

Member
It’s an increasingly familiar tale in Hong Kong, a city of soaring skyscrapers and glittering luxury boutiques that’s become perhaps the epitome of income inequality in the developed world.
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London: "hold my beer."
 
C

Cave Johnson

Member
That's why I want to move out of Hong Kong. The costs are bloody insane. Anywhere else would be a haven if I'm not making the equivalent of an executive.
 
A

aznpxdd

Member
Yep, HK is not a fun place to be at all if you don't got some $. They are literally trapped in that little spot, at least the poor in China have the option to move around.
 
T

Trace

Banned
Behold: Capitalism.

Shit isn't sustainable without checks and balances in place, you need someone to stick up for the little people.
 
P

psaman17

Banned
Nikodemos said:
I'm pretty certain Beijing is doing this in order to force people out of Hong Kong proper and into the mainland where they are a) easier to control/watch over; b) dispersed into the larger mass of mainlanders who either like or are indifferent to the government.
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Thats ridiculous. HK has always been an expensive place to live in even under british rule pre china. That's what happen when 8million plus people tries to cram in a tiny city. This is supply and demand at play here, welcome to capitalism.
 
T

TheWraith

Member
Nikodemos said:
I'm pretty certain Beijing is doing this in order to force people out of Hong Kong proper and into the mainland where they are a) easier to control/watch over; b) dispersed into the larger mass of mainlanders who either like or are indifferent to the government.
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I fully agree with this theory.
 
T

Timbuktu

Member
psaman17 said:
Thats ridiculous. HK has always been an expensive place to live in even under british rule pre china. That's what happen when 8million plus people tries to cram in a tiny city. This is supply and demand at play here, welcome to capitalism.
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Hong Kong used to have the largest public housing programme in the world at one point, but not anymore. The government derive revenue from leasing the land, so the supply is more contrained than it should be. I don't believe CCP is trying to disperse people however, central Shenzhen is catching up on the ridiculous prices too. It is fair to say that mainlanders do drive up prices.
 
Robot Carnival

Robot Carnival

Member
HK's housing market had always been bad, but it only gotten outa control after 1997 when China took back the place. it didn't change much at first, in fact, I think it dropped for a little back then. but now with all the Main Land China new money coming there to grab up land, it just gone through the roof. if you're working a 9 to 5 job, you basically have no hope of getting a place of your own unless you win the lottery or something.
 
A

AxeMan

Member
Talk metric people. What's 120 square feet to metres?

Edit

11 square metres or 1 square.

Forget that. My first house was 11 square. I couldn't imagine living in 1 square
 
Nikodemos

Nikodemos

Member
I'm pretty certain around here builders are strictly forbidden from constructing flat complexes with less than 25 square metres of livable space. 12 square metres is insane, it's less than what Tier IV flats had during the commies' time (and they didn't put much stock into comfort).
 
D

Dazza

Member
psaman17 said:
Thats ridiculous. HK has always been an expensive place to live in even under british rule pre china. That's what happen when 8million plus people tries to cram in a tiny city. This is supply and demand at play here, welcome to capitalism.
Click to expand...

Yeah HK was always this way, well before the handover. Nothing to do with any ulterior motives by the Chinese government. It's just what happens when more and more of the wealth goes to fewer and fewer people with nothing to push it back the other way. End game capitalism
 
B

bluethree

Member
Nikodemos said:
I'm pretty certain around here builders are strictly forbidden from constructing flat complexes with less than 25 square metres of livable space. 12 square metres is insane, it's less than what Tier IV flats had during the commies' time (and they didn't put much stock into comfort).
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there are places as small as 12 sq meters in tokyo - my first place here was that size and i moved after about a month for unrelated reasons. i'll be going from 16 > 25 square meters by moving again in a month or so, and honestly, even as a single guy i find it really tough to live in a place that small
 
K

Koren

Member
MGrant said:
about 12 square meters.
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7 tatamis ;)

That's really small, but I don't think it's an exception. Law here forbid to rent flats less than 9m² and less than 20m³, so there's plently of rents of that size. Many students don't live in much larger places.

There was even someone renting a 1.56m² place for 330€ a month (obviously illegal, but that show how people can rent anything when they don't have a choice)

bluethree said:
there are places as small as 12 sq meters in tokyo - my first place here was that size and i moved after about a month for unrelated reasons. i'll be going from 16 > 25 square meters by moving again in a month or so, and honestly, even as a single guy i find it really tough to live in a place that small
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I've rent a ~14 sq meters flat in Tokyo, and while it's livable for a couple of months, it's hard for a long time. I currently have >5h of commute time because I have a 110 sq meters flat I don't want to let go for a far, far smaller flat in Paris or in its suburbs.
 
blitz64

blitz64

Member
I'm surprised that Los Angeles at #8 is less affordable than San Francisco #9.

I guess that mean San Francisco people make more money and real estate can go even higher.
 
T

TheWraith

Member
Dazza said:
Yeah HK was always this way, well before the handover. Nothing to do with any ulterior motives by the Chinese government. It's just what happens when more and more of the wealth goes to fewer and fewer people with nothing to push it back the other way. End game capitalism
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Well no, it has everything to do with the Chinese government increasing control over HK. The chinese government forces 150 people from China to immigrate to HK EACH DAY. This has increased the population over one million people since the handover, straining property prices to the limit.

Property prices could also be made much much lower if the government would re-zone empty old factory buildings to residential space, as currently no-one is allowed to reside in such areas. These areas could then be redeveloped to flats. Unfortunately there is no money in this for the tycoons in government as they prefer to keep rents artificially high as they stand to gain more.

The same logic also applies for many other areas here: Take taxis for example: the taxi licenses are also held by government tied groups and go for outrageous amounts of money. Uber and similar activities are banned, excluding any fair competition which would keep prices under control. The water supply from China is also charged outrageously, around 200 times more then what Singapore pays for its water to Malaysia! I could go on and on with examples.

Any other form of government would already have made measures to do anything about the above, not so in Hong Kong.
 
A

aznpxdd

Member
TheWraith said:
Well no, it has everything to do with the Chinese government increasing control over HK. The chinese government forces 150 people from China to immigrate to HK EACH DAY. This has increased the population over one million people since the handover, straining property prices to the limit.
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Source?
 
E

Ecotic

Member
blitz64 said:
I'm surprised that Los Angeles at #8 is less affordable than San Francisco #9.

I guess that mean San Francisco people make more money and real estate can go even higher.
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Every organization has a different formulation that changes the order but the top 10 or 15 in the world is fairly stable from list to list. I would just look at the top 15 and not pay much attention to the actual order.
 
G

Gibbo

Member
Really glad that that HK citizens housing woes are getting so much exposure in the international press these 3 months. I live the country and visit there every year. But it's quite shameful that it's government has neglected it's citizens esp on the issue of housing.

Was walking in Elements in Kowloon 2 months back, and was approached by this real estate agent who was selling a 400 sqft unit for close to $1m USD. Absolute bonkers
 
N

numble

Member
Ecotic said:
Every organization has a different formulation that changes the order but the top 10 or 15 in the world is fairly stable from list to list. I would just look at the top 15 and not pay much attention to the actual order.
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I think that is untrue. Some lists exclude mainland China for instance, which makes the ones that include China very different from the ones that exclude China.
 
andythinkpad

andythinkpad

Member
This is what happens when you let real estate families control the libertarian government and artificially stranhgle the new property market.

For one thing the Chief Executive doesn't have nearly enough power to do what he/she need to do to save HK's economy.
 
T

TheWraith

Member
numble said:
These people are not being forced to immigrate to Hong Kong, they do it because they want to live in Hong Kong. It is very easy to immigrate to Hong Kong if you are not a mainlander or not a domestic housekeeper.
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No the One-way Permit scheme is specifically for Mainlanders:

Although the permit is specifically for the purpose of family reunion, not for general immigration,[3] the scheme is controversial. Hong Kong currently has a quota of 150 people per day and the waiting time for spouses is currently 4 years.[4] Journalist Ching Cheong alleges that the scheme, whose beneficiaries are at the sole discretion of the PRC government and outside of the vetting procedures of the Hong Kong Immigration Department, is an infiltration mechanism by spies and friends of the regime into Hong Kong; those that are not filled by spies become a graft mechanism for officials.[5][6] Martin Lee said that the policy is part of the CPC's strategy of long-run "Tibetisation" of Hong Kong, aimed at marginalising Hong Kong people and their core values over time.[6][7]
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https://en.wikipedia.org/wiki/Peopl..._Permit_for_Proceeding_to_Hong_Kong_and_Macao
 
N

numble

Member
TheWraith said:
No the One-way Permit scheme is specifically for Mainlanders:



https://en.wikipedia.org/wiki/Peopl..._Permit_for_Proceeding_to_Hong_Kong_and_Macao
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You say they are forced to move to Hong Kong. Like they get a peasant and force them to move to such an expensive city? They do it on their own accord.

There is no quota and less restrictions for other foreigners that want to move to Hong Kong, is what I was saying (unless you are a housekeeper from SE Asia). Many Chinese went and bought passports in other countries so that they can move to Hong Kong more easily.
 
T

TheWraith

Member
numble said:
You say they are forced to move to Hong Kong. Like they get a peasant and force them to move to such an expensive city? They do it on their own accord.

There is no quota and less restrictions for other foreigners that want to move to Hong Kong, is what I was saying (unless you are a housekeeper from SE Asia). Many Chinese went and bought passports in other countries so that they can move to Hong Kong more easily.
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Well no, it is part of the usual scheme (see: Tibet) of the Chinese government to push regime-loving people in. Look at the quotes I've quoted above both Ching Cheong and Martin Lee are VERY well respected journalist and legislator respectively. Martin Lee was in the committee that drafted HK's basic law.

Hong Kong has control over its own immigration, EXCEPT for the One Way Permit scheme, which the Chinese government controls. Any attempt to take the right back to HK and control the population is brushed away, that alone tells a lot.
 
N

numble

Member
TheWraith said:
Well no, it is part of the usual scheme (see: Tibet) of the Chinese government to push regime-loving people in. Look at the quotes I've quoted above both Ching Cheong and Martin Lee are VERY well respected journalist and legislator respectively. Martin Lee was in the committee that drafted HK's basic law.

Hong Kong has control over its own immigration, EXCEPT for the One Way Permit scheme, which the Chinese government controls. Any attempt to take the right back to HK and control the population is brushed away, that alone tells a lot.
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Why doesn't the government force Hong Kong to give equal treatment to Mainlanders, then? Foreigners are treated much better (unless you are a housekeeper from SE Asia), it is even more difficult for a Mainlander to visit for tourism than a foreigner.

If you want to compare it to Tibet, all Mainlanders can move to Tibet if they want to, there is no quota that makes them wait 4 years to move there.
 
T

TheWraith

Member
numble said:
Why doesn't the government force Hong Kong to give equal treatment to Mainlanders, then? Foreigners are treated much better (unless you are a housekeeper from SE Asia), it is even more difficult for a Mainlander to visit for tourism than a foreigner.

If you want to compare it to Tibet, all Mainlanders can move to Tibet if they want to, there is no quota that makes them wait 4 years to move there.
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The hell?? Isn't it obvious, HK is a small territory bordering a developing country of more then 1 billion people, you do the math.

Also, in theory HK still controls its own immigration and China is not allowed to interfere, the only exception the One-Way permit loophole.
 
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