So the equity market is crashing down faster than someone can say "emergency Fed rate cut". So we hear about foreclosures and diminishing portfolio values. So what is there left to invest in?
Interestingly, the Hong Kong property market. As liquidity begin to flow from the mainland into the Special Administrative Region through a number of channels, and as Hong Kong seeks renewed demand in its housing market to relieve the pressure from its overweight stock market, one might find that all is not lost.
Why buy new property in Hong Kong?
For homeowners: many Hong Kong people did not have the opportunity to buy an apartment within the past decade, largely due to the collaspe of the housing market after the handover in 1997 and then due to SARS in 2003. It was only after 2006 and the first half of 2007 that many investors (in equity markets) had the luxury of sparing cash for their dream home. Aside from the credit crunch in the States, many Hong Kong people feel that this is high time for buying in and upgrading.
For speculators: as one would know from living in Hong Kong, land is scarce. Supply is limited but demand is potentially infinite. As government regulators attempt to cool down the property market in China, its counterpart in Hong Kong can only become more heated. Liquidity from the mainland, facing the dilemma of a lesser upside in Chinese markets, will inevitably head towards the more mature Hong Kong market following the QDII and "through train" schemes.
Considering those reasons, I'd say that one has a safe bet in Hong Kong.
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