Car Ownership Ratio Low Despite Relatively High Income
Zeppelin Real Estate Analysis Limited
the profile for Hong Kong among Asian economies and cities, and is based
on researches done by professional groups in 2003. The more interesting
and salient points are as follows:
= CEOs, top executives, senior managers, professionals, business owners etc
from Hong Kong, Singapore, Kuala Lumpur, Bangkok, Manila, Jakarta, and
Taipei were surveyed, and these represented roughly the top 10% of the
population in terms of earned income.
Individual Income in US$ terms
= is around
US$27,000 with Hong Kong being the highest at US$65,000. Singapore, Kuala
Lumpur, Bangkok, Manila, Jakarta, and Taipei earn US$41,000, US$16,000,
US$12,000, US$8,000, US$7,000, and US$33,000 respectively.
= the average of the 7 cities is 65%, but Hong Kong has the lowest ratio
this instance at around 34%, and 64%, 92%, 69%, 64%, 56%, and 82% apply to
Kuala Lumpur, Bangkok, Manila, Jakarta, and Taipei respectively. Please note
this car ownership ratio may also be influenced by other
non-economic-financial factors such as transportation policy, industrial
policy, economic structures, and the like. Broadly, such policies are either
pro-car-ownership (especially in economies which produce their own cars) or
against car ownership.
= expressed in US$ / per m2 floor area / per year. Hong Kong has the highest
figure at around US$400 while Manila has the lowest at US$50. The rest hover
between US$70 to US$215.
A Office in CBD Rental Levels
= expressed in US$ / per m2 floor area / per year. Hong Kong again has the
highest figure at close to US$400, while Kuala Lumpur is lowest at US$63.
The rest hover between US$70 to US$240.
simple correlations have been done:
car ownership ratio have little correlation
= as the level of car ownership can be very much influenced by non-economic
factors such as government policies, which collectively may either directly
or indirectly, intentionally or unintentionally, render car ownership a
burden or a breeze. Also, the urban pattern and city density may also affect
people¡¦s enthusiasm to own a private car. For instance, cities with a good
public transportation network may render a private car less necessary.
correlates well with rental levels
= both residential and office. This is not surprising as in the long run, it
is rare to find high income cities with disproportionately low rents.
Everything in an expensive city tends to be more expensive.
ownership ratio and rental levels do not correlate much
= please note we are just talking about car ownership ratio, not the type /
make / quality of cars. Perhaps the latter aspects would have a bit more
correlation with rentals.
rental level would have some implication for real estate prices, which in
turn means income would have some hints on real estate prices, car ownership
ratio is not a reliable indicator of what real estate prices may be.
The article and/or content contained herein are for general reference only
and are not meant to substitute for proper professional advice and/or due
diligence. The author(s) and Zeppelin, including its staff, associates,
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