HONG KONG: Hong Kong housing is at risk of becoming the least affordable in 24 years, as rate hikes by the US Federal Reserve drive up borrowing costs in the Asian financial hub.
The percentage of monthly household income used for mortgage repayments in Hong Kong could reach 60.1%, the least affordable level since 1998, if mortgage rates rise to 3.5%, according to Bloomberg Intelligence.
That could deter buyers unless household incomes surge or home prices decline further, Bloomberg analysts Patrick Wong and Francis Chan wrote in a note.
For the ratio to remain at about 56%, current home prices need to drop by at least 10%. — Bloomberg