It seems that the generous housing perks often accorded to expatriate executives assigned in Hong Kong may not be as lucrative as it used to be.
Real estate observers see housing allowance fat enough to rent a luxurious 4,000 sq feet harbor-view home at the Peak or HK$300,000 ($38,650) a month seaside townhouse in Repulse Bay were being slashed, EJ Insight says citing Bloomberg reports.
More humble abode are becoming the new normal as expats have to give up amenities such as jacuzzis, wide private gardens and stunning views.
Maureen Mills, managing director of Executive Homes Hong Kong Ltd, a real estate agency with close association with law firms see more downsizing.
“Partners used to have company leases and were happy to spend HK$150,000. Now with cash packages, they are more comfortable at HK$80,000 to HK$100,000,” she said.
In the first quarter of 2016, only 7 per cent among expat property clients of Jones Lang LaSalle Inc. availed of property rentals of more than HK$100,000. In 2012, there were 31 per cent. Now, more than half of clients (54%) settled for properties with less than HK$30,000 monthly rentals — good for two small bedrooms into 550 square feet in Central — a big rise compared with 11 per cent just four years ago.
Stella Abraham, head of JLL’s Hong Kong residential leasing and relocation services for companies such as JP Morgan Chase & Co. and Citigroup Inc. said the number of finance clients with corporate packages moving to Hong Kong through her company has halved.
The downward trend is a sharp contrast just five years ago when clients were willing to spend as much as HK$300,000 worth of housing allowance per month on a “use it or lose it” terms.