Hong Kong’s record property prices push more millennials into mortgage debt
The city’s young people are taking on more debt amid record home prices, with a lot of help from dad and mom
Hong Kong’s millennials are becoming better represented in the home buying market, taking up one in three new mortgages this year, a new report shows.
However, many agents say it is often their parents who are paying the huge deposits for the flats given the sky high prices of housing in the city.
Millennials – who are currently 23 to 37-years-old – accounted for 32 per cent of total new mortgages in the second quarter of the year, up from 19 per cent in 2013, making them the second largest age group after Generation X, that’s those aged 38 to 52, the report from credit bureau TransUnion has found.
Ivy Wong Mei-fung, managing director of Centaline Mortgage Broker, says the biggest barrier for millennials to get their first foot on the housing ladder in Hong Kong is the down payment, which makes up at least 20 per cent of the home price, and so that’s why so many parents are now stepping in to help.
According to a recent survey Demographia, the city has just been ranked the world’s “least affordable” in which to buy a home for a seventh year running, with flats costing over 18 times annual median income.
“I’m scared that if I don’t buy now and with prices keeping going up, it will become even more difficult for me to afford a home,” said Elaine She, a Xiamen-native who moved to Hong Kong for postgraduate studies a decade ago.
