There has been a notable increase in offering of tiny flats in Hong Kong in recent years. The same trend seems to be emerging in Shenzhen across the border.
Located in Nanshan district in Shenzhen, about 2 minutes drive from the CBD area in Futian district, a new project recently offered a batch of nine mini flats with an average size of 6 square meters, or 64.5 square feet.
The property used to be a hotel. Amid a frenetic surge in home prices, the developer converted the hotel into a residential project.
The tiny flats were offered at 150,000 yuan per square meter, a price that puts them even above that of many new homes in downtown areas in Hong Kong.
Still, the “pigeon holes” — whose sizes ranged from 5.73 to 7.48 square meters, were all snapped up within a few hours.
Part of the reason for the strong interest is the affordability.
With a size just half that of a tiny apartment in Hong Kong, even at a lofty per square meter price, the lump sum amounts to just about 900,000 yuan. If one gets a 70 percent mortgage, the down-payment needed would only be around 270,000 yuan.
Comparatively, a 50-square-meter flat, which is the more usual size, costs at least 4 million yuan.
These flats are clearly targeted at singles and are quite well designed for that purpose.
Fold-down beds and built-in storage are used to save space. The units come with a mini kitchen and washroom. They may be small, but they are fully functional.
One interesting difference between Shenzhen and Hong Kong is that the actual usable area is typically higher than the saleable area in the former, while the opposite is true in Hong Kong.
A six-square-meter apartment in this project is actually about 8 square meters, according to Shenzhen property agents.
While the expensive pricing reflects a bubbly China property market to some extent, it also highlights the extremely high population density in Shenzhen.
Shenzhen has a permanent population of 21 million, three times that of Hong Kong, but the city only has an area of 1,948 square kilometers, versus Hong Kong’s 1,103 square kilometers.
Shenzhen has a population density of 10,800 persons per square kilometer, far above the 6,500 in Hong Kong, 3,800 in Shanghai, 1,740 in Guangzhou and 1,310 in Beijing.
As a special economic zone, Shenzhen can’t expand like most other mainland cities and is therefore faced with a serious shortage of fresh land supply.
Meanwhile, the fast developing internet and tech sector in Shenzhen, led by giants like Tencent, Huawei, Zhongxing and BYD, serves as a strong magnet to draw a large number of young workers to the city, exacerbating the housing shortage.
The mini apartments may not be ideal homes for families, but they fit in nicely with the budget and accommodation needs of the young, single workers coming from other parts of China.
This article appeared in the Hong Kong Economic Journal on Sept. 26.
Translation by Julie Zhu
[Chinese version 中文版]
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