An analysis of sale prices of domestic units built in 1970 illustrates the extent to which prices have risen over the last year. In 1969, premises priced in the "$30,000 and below" bracket represented 39.49 per cent., while for 1970 the proportion of units built for less than $30,001 had drop- ped to 20.61 per cent. The majority of premises fall into the "$30,001 to $60,000" price bracket which repre- sented over 60 per cent. of all units built in 1970.
A Rental Index is provided in the report to illustrate the general trend of rents. For domestic accommodation the index has moved up nearly 14 points over the year or 18.21 per cent. since December, 1968. An analysis of cases in the sample where rent in creases were effected during 1970 shows an average increase overall of 22.81 per cent. but, as expected, the heaviest increases have occurred in the case of medium and large flats where average increases are noted as 35.13 per cent. and 41.55 per cent. respec- tively. The highest percentage increase is for large flats in Kowloon at 48.76.
Increases during 1970 for small flats averaged 19.20 per cent. while for tenements average increases were be- low 15 per cent. The report compares these figures with those cases where certificates had been issued under the Rent Increases (Domestic Premises) Control Ordinance 1970 in response to applications for increases in rent of more than 15 per cent. and notes that the overall average increase in cases dealt with up to the end of 1970 was 18.5 per cent., while for medium and large flats it was 23.7 and 28.7 per cent respectively.
Shops
There were 251 rated ground and upper floor shop units vacant in De- cember 1970 accounting for 178,130 sq. ft. of space. The report mentions that these figures are not complete as they do not include many new pre- mises which have still to be assessed to rates. Of those assessed, vacant ground floor shops have increased from 154 to 219 over the year while for upper floor units there is little change in the position noted at December, 1969.
The table on rental movements for shops indicates that in the aggregate, rents have been increased very nearly 11 points over 1969 or 15.47 per cent. since 1968. However, rents were in- creased in very nearly half of the shops
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included in the sample and looking at just these cases the average increase compared with December, 1969, was 25.43 per cent. The largest increases generally were at Tsuen Wan, where good trading positions in this rapidly expanding township are eagerly sought after by shopkeepers. However, some of the heaviest increases individually were undoubtedly experienced by shopkeepers in Tsim Sha Tsui.
Offices
The amount of new office accom- modation completed during 1970 was rather less than estimated and, with a higher rate of occupancy, vacancy at December 1970 was down to 142,542 square feet, of which only 5,531 square feet was considered Grade 'A'. However, two buildings in the Sheung Wan/Central districts are just being completed and supply in 1971 will be considerably up on expectations.
The amount of space becoming available in 1971 is likely to average just over 70,000 square feet per month compared with the 52,647 square feet available in 1970. It is estimated that a further 825,000 square feet will be completed in 1972, mainly in the Sheung Wan/Central districts of Hong Kong which, despite some attempts at decentralization, is where the real demand continues to be.
Some indications of asking rents for vacant office accommodation are given in the report. In line with the economic climate the demand for of fice accommodation has increased over the year and with it rents. Whereas, a year ago the average rent for Grade 'A' accommodation in Central/Sheung Wan was a little over $2.00 per square foot per month (exclusive of rates and air-conditioning charges), by the end of 1970 rents were fast approaching
the $4.00 mark.
Flatted factories
A total of 5.6 million square feet of space was completed during 1970, a figure that has only once been exceeded
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in 1965. Similarly vacancy, up to 1.9 million square feet at December 1970 from 421,731 square feet a year earlier, has only been exceeded on two previous occasions, in 1966 and 1967.
The vacancy figure in December 1970 was, however, influenced by a good supply in the latter half of the year which accounted for 71 per cent year which accounted for 71 per cent of the year's output and very nearly 70 per cent of what was found vacant
in December 1970 related to premises completed only in the last three months 'of the year. The emphasis of new deve- lopment has been in Kwun Tong and Kwai Chung and this trend seems like- ly to continue with over 7 million square feet expected to be completed in the New Kowloon and Tsuen Wan areas during 1971.
Overall, 9.5 million square feet of flatted factory space is expected to be completed only in the last three months million square feet in 1972. With a vacancy figure of 1.9 million square feet at December 1970 it seems prob- able that in 1971 and 1972 supply will exceed demand by a substantial mar- gin.
The Rental Index shows that flat- ted factories have come off worse in 1970, with the December, 1970 index standing some 22 points over 1969 or 44 per cent. above the 1968 level. Tsuen Wan shows the largest increase with the index now standing at 165.61 but this is because previously rents for flatted factory space in this area were very depressed.
Analysing just the cases where rents had increased in 1970, the average increase was just over 50%. According to the report, it appears that the balance of supply and demand is already swinging in favour of users and rents and prices should fall to a more reasonable level in consequence.
PUBLIC HOUSING TARGET THE present target for resettlement and low-cost housing for the six years ending April 1975, is for 590,000 in- dividual units.
Mr. J.J. Robson, director of public works, gave this figure in a review of the public works programme last month. But, he said, it would be diffi- cult if not impossible to find suitable sites for housing estates in the areas where people in the qualifying income group now lived.
The only new sites available for government housing in or adjacent to urban areas were Ap Lei Chau, Chai Wan and Clear Water Bay Road, and these bad limited capacity.
Mr. Robson said it appeared it was the reluctance of people to move to the new towns that might be the limiting factor on the provision of government housing, but there was some evidence to suggest that the reluctance was 'gradually being overcome'.
Far East BUILDER, April 1971