Hong Kong actress Michelle Reis was said to have complained once that her flat was too cramped for all her wardrobe and got a huge villa a week later as a present from a tycoon.
The story is most probably just a show business rumor as the former beauty queen can very well afford a huge home.
But the truth is, many young ladies — and men, too — find it hard to find enough room for all their clothes in the city, where the average living space per person is only 161 square feet, according to the latest government data. No wonder some local laundry shops now offer cloaking and deposit services — for a fee, of course.
It was also reported that a Yale law graduate, hired as a legal assistant to the vice president of a prestigious bank in Hong Kong, went flat hunting in Sai Wan with a budget of HK$12,000 (US$1,547). It turned out he chose the wrong place. A two-bedroom condo measuring 400 square feet now starts at HK$16,000 a month as the MTR is expanding into the district.
In Hong Kong, a 1,000 sq ft home is a luxury for the privileged few, such as those bankers working in sleek skyscrapers in Central. Sorrento, a luxury development by Wharf Holdings (00004.HK) that stands right above the Kowloon Station, is among the most popular for expats and senior executives. An apartment in one of its 70-storey towers costs more than HK$40,000 a month to rent.
Certainly you can find “cheaper” alternatives like a flat in Bel-Air, which starts at HK$28,000 per month, but its suburban location – near Cyberport on the southern end of Hong Kong island and not accessible by MTR – means you have to have your own car and that would cost you an extra HK$8,000 to HK$10,000 a month for parking in Central.
So for most of us who can’t afford such luxurious accommodation, a shoebox unit would do for now.
And in order to be able to afford living in one of the world’s most expensive cities, many Hong Kong people resort to working overtime.
Visitors are impressed by Hong Kong’s glittering skyline and the night view across Victoria Harbor with skyscrapers illuminated throughout the night. But behind those enchanting scenes is the backbreaking work of staff who stay in the office beyond the regular working hours.
A 2012 survey by UBS found that Hong Kong ranks among the world’s top five cities in terms of average working hours per year (2,296 hours). The figure, which many in the city find to be on the conservative side, translates into 9.2 hours per weekday, as compared to 7.9 hours in Shanghai. Since many have to work beyond normal hours in the office, their flats only serve as a place to sleep and have a shower. And for those activities, they don’t really need a large space.
Despite the high cost of living, Hong Kong still draws a robust flow of high-caliber graduates and jobseekers from overseas.
On top of its status as a key destination for expats and professionals, the territory now attracts an army of young and ambitious mainland Chinese armed with economics, finance and MBA degrees from prestigious universities in Britain or the United States.
For them, Hong Kong’s world-class financial environment means they don’t need to go back and work on the mainland, where the Chinese way of doing things they now find frustrating after having stayed abroad for years.
Despite its high costs, Hong Kong offers better remuneration packages. The territory’s simple and low tax regime adds to its charm. The usual salaries tax allowance is no less than HK$120,000 a year, and there are other deductions for those who are married and have children. On the mainland, one must pay individual income tax if the monthly salary exceeds 3,500 yuan (US$571).
Another reason is career advancement.
Not all mainlanders working in the territory will choose to stay on until retirement but their Hong Kong experience can be a big plus on their resumes if they opt to return to the mainland. This is especially true in the case of those working in investment banks and other major financial institutions: if you do not have some overseas exposure, you may find that promotions are hard to come by.
Many also fancy Hong Kong’s status as a world city. Some think that even Shanghai, despite its long history as a cosmopolitan city, pales in comparison to Hong Kong.
Leading consulting firm A.T. Kearney puts Hong Kong in fifth place in its 2014 Global City Index report after New York, London, Paris and Tokyo; Beijing, Singapore and Shanghai are in the 8th, 9th and 18th spot respectively.
Says one mainland observer: “In Hong Kong, you can find some of the world’s largest banks and trading houses inside the same office tower. You can pamper yourself once in a while in one of the numerous Michelin-starred restaurants in the city or some of the world’s most fabulous shopping precincts. Besides, here you will be pushed to constantly brush up your English.”
All this explains why so many Chinese graduates from US and European universities want to come to the city for their first job in the financial sector and choose to live in tiny flats and work overtime every day – even if they have the option of living far more comfortable lives in their hometowns where they can afford a spacious home and an expensive car.
But how long will this last as rival cities move aggressively, offering better housing and work-life balance, to attract the best and the brightest?
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