Pricey Hong Kong Property Breaks World Record

A five-bedroom duplex on the lower slope of Hong Kong's exclusive Peak has sold for a world record $71,280 Hong Kong Dollars or $9,000 U.S dollars per square foot.

Henderson Land Development's Thomas Lam said the US $56.6 million apartment even surpassed London prices.

[Thomas Lam, Henderson land Development]:
"Hyde Park 1 in London, they made a transaction in '08 that per square foot is 6,000 pounds, per square foot, but they count all the saleable area, saleable area. So 39 Conduit Road, the record, we modified it into the saleable area per square foot, and it will become HK $88,000 per square foot. So I think we have broke the world record for the residential flat unit category."

Property prices in Hong Kong have surged over 25 percent this year despite the economic downturn, amid little new supply and strong demand from wealthy Chinese who now account for 11 percent of property sales.

The Hong Kong government controls land supply and has not sold residential land for a year and a half.

In his annual policy address this week, Chief Executive Donald Tsang said the government was ready to reign in property prices.

[Donald Tsang, Cheif Executive]:
"The relatively small number of residential units completed and the record prices attained in certain transactions this year have caused concern about the supply of flats, difficulty in purchasing a home, and the possibility of a property bubble. The Government will closely monitor market changes in the coming months."

The city's last property bubble burst with the Asian financial crisis in the late 1990s, triggering a 70 percent plunge in apartment prices over six years that slammed the economy and local property owners.
   
But analysts say, even with the record prices, that sort of speculative buying is not yet apparent.