HK rental index reaches record-high after 10 months of growth

Hong Kong's private domestic property rental index surged to a record-high after experiencing consecutive growth for 10 months.

Some property agents say demand remains high despite a decrease in the supply for properties available for rent, adding there should still be a 5 to 8% rent increase for the remainder of the year.

Residents have been mostly conservative when it comes to residential purchases in recent times, while the rental market remains largely active.

According to data released by the Rating and Valuation Department, the private domestic property rental index rose by 1.6% in the month of August, breaking prior records and marking 10 months of consecutive growth.

This means rents have risen by a total of 4.8% throughout the year.

In Taikoo Shing, a property agent says a local owner was willing to rent out their 582-square-foot apartment for 30,000 dollars, but stresses units of a similar size were available at just 25,000 dollars at the start of the year.

He believes rents will continue to rise by around 5 to 8% for the remainder of the year, adding the increasing demand is partially driven by mainland students studying in the city.

This as the private home price index, while having reversed July's decline, only rose by less than 1% in August, with many residents preferring to rent instead of purchasing properties in recent times.

Some analysts notes the property market's performance continue to be hampered as a result of less-than-optimistic interest rates in the city.