The below graphs are taken from a recent (June 2019) report by Knight Frank on "prime" residential pricing across the world. They define "prime" as generally being the top 5% of each market by value. What these graphs show are the spread between the average price of a prime property and the top price achieved in that market.
The most expensive market is Hong Kong. The average price of a prime property in 2018 was USD 4,251 per square foot (or USD 45,760 per square meter) and the top price achieved was in 2016 at USD 28,154 per square foot (or USD 303,051 per square meter).
Using the 2018 average, a 350 square foot studio apartment would run nearly USD 1.5 million (or almost CAD 2 million), assuming there are "prime" studios available in the market. Remember, we are talking about the top end of the market.
If you'd like to download a copy of the full report, you can do that over here.
Over the long weekend, and across a couple of flights, I read Perfect City by Joe Berridge. I thoroughly enjoyed it. Each chapter focuses on a different world city, starting with the one and only Toronto. From New York to Singapore and London to Belfast, Joe hones in on what is working and what is not working.
No city is perfect.
I found myself folding the top corner of the page on numerous occasions. I did this every time I came across an interesting takeaway or stat, such as this one here: "Angela Merkel, the German chancellor, recently observed that Europe has 7 per cent of the world's population, 25 per cent of its GDP, and 50 per cent of its social expenditures."
However, the thread that really stood out to me is one about individuals. We all know that great things happen as a result of great teams. But as Joe profiles the various city building initiatives that he has come across throughout his work and travels, a common theme seems to emerge.
From Jane Jacobs to Lee Kuan Yew, there's often a determined individual who is set on making something happen, or set on stopping something from happening, as is the case with Jane Jacobs and Toronto's (proposed) Spadina Expressway.
This is not meant to discredit the value of teamwork. We all know that is essential. Instead, I think it speaks to the power of individual passion, conviction, and tenacity -- all of which are ingredients required to build a perfect, or almost perfect, city. Wonderful things don't just happen on their own.
Photo by Fraser Cottrell on Unsplash
There's now evidence to suggest that the political crisis in Hong Kong may be having an impact on capital flows. Bloomberg, as well as others, reported today that wealth managers in Asia have been receiving a heightened number of requests to transfer assets out of the country -- to places like Singapore -- and to setup new overseas bank accounts so that they can be ready to transfer, should the situation gets worse.
In fact, the Monetary Authority of Singapore (MAS) even asked the country's financial institutions not to prey on the wealthy in Hong Kong during this period of uncertainty. They want to avoid the perception that Singapore is trying to capitalize on the situation. Of course, it remains to be seen how much all of this is here-say and how much of it will actually translate into a meaningful transfer of wealth.
Hong Kong has a significantly larger private wealth base, with about 853 individuals worth more than $100 million. This is more than double the number in Singapore (figure from Credit Suisse). But the current demonstrations have people questioning what will happen to Hong Kong in 2047 when the constitutional article committing Hong Kong to a capitalist way of life is set to expire.
The flows of capital can be fickle.
Photo by Florian Wehde on Unsplash