Hong Kong Residential: the More Rich People, the Higher the Price / ft2
Real Estate Analysis Limited
Recently there was a report by a bank giving details on the number of
millionaires in each district of Hong Kong. Millionaires are defined as
people having HK$1M or more (HK$7.80 = US$1.00) in liquid assets (such
as cash, stocks etc). Hence, just for fun, your humble author has
attempted to match such numbers against published real estate price data
to see if there is a relation between the number of wealth folks and the
typical / representative average real estate price per floor area (HK$ /
reminding the readers that such calculations tend to very ¡¥ballpark¡¦, there
seem to be some correlation between them. A few notes as follows
= were based on those released publicly by Citibank recently
average prices per floor area data
= were based on those found in the Centaline Agency¡¦s Centa-City Index
= might have existed when selecting the average price data of a
district-representative-reflective residential complex to use
= i.e. no adjustments, plus or minus, have been done for a district with a
higher population and / or with a higher quantity of residential properties
results are as follows:
= the correlation is around 0.53, which is not overly high yet definitely
implies some relation between them [Note: a different correlation may be
arrived IF hypothetically someone decides to select residential complexes
different from the ones selected by your humble author]
= the correlation is not only lower at 0.41 but demonstrates a negative
gradient. Nonetheless, this may have to do with the data macro-limitations
and the sample size being very small.
correlation is not very strong at 0.36.
(including the islands other than Hong Kong Island) = the correlation is
around 0.54 being very close to the territory wide figure.
large, these correlations, notwithstanding their broad-brush tendencies, may
suggest that the district demarcations and their coverage (seemingly
following broadly the electoral districts) are generally sizable to an
extent that no district is distinctly and overwhelmingly rich or poor i.e.
there are rich folks even in the perceivably poor districts and not so rich
residents in largely well-off districts. Alternatively, it may also mean
some rich folks lead relatively plain and frugal lifestyles, including
living in a modest home.
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