HK property bargains: Haunted housesBy Elmer W. Cagape Dec 04, 2011 11:08AM UTC
If you’re on the hunt for a decent flat and don’t believe in superstitions, then you could be in for bargains in Hong Kong’s property market. That’s when because local culture turns its back on properties that are associated with unfortunate happenings, it leaves such homes tainted with misfortune to a smaller share of potential buyers. A house whose previous occupant committed suicide or had a mysterious death could fetch up to a 40% blow in the local market value.
Hong Kong people are generally superstitious. From what things to do during Chinese New Year to arranging furniture at home, there is a standard practice that needs to be followed. When selecting domestic helpers, I’ve heard friends who have been subjected to feng shui before getting admitted into the household. House maids who shed tears in the premises of their employers could risk outright termination from work if caught.
If most locals are unwilling to tolerate “small issues”, they’re obviously reluctant to be part of something bigger. Like buying flats on a building where a gruesome murder took place many years ago. Such a building can be classified as hongza — a term which connotes an unfortunate dwelling place — and properties within the building may have difficulty selling at prevailing market rates. In a city where suicides methods such as jumping off a building or burning charcoal in a room isn’t uncommon, hongza houses could be scattered across Hong Kong.
In a period when residential property prices seem to cool down, some people venture into where many others can’t dare to go. Hongza houses can be a profitable investment as they are sold typically 15 to 20 per cent lower than others. When someone buys the house and rents it to another, for example a foreigner who doesn’t care about conventional beliefs, they usually get higher rent yields than mainstream property landlords.
In Hong Kong, you don’t have to go far and wide to find places that look haunted. In the older districts of the city, low-rise buildings that were built in the 60s and are bereft of attention and maintenance, host poorly lit corridors that remind you of local horror films. But unless a property agent discloses that something bad occured in the premises — yes, they are required to disclose it, if any — rates may not be as low as one would expect from a hongza house.
But for certified haunted houses such as those listed at Square Foot, expect a lower price in exchange with the risks associated with owning the property. A closer look at the list reveals that a desperate man hanged himself earlier this year in the kitchen after being told of his lung x-ray result. Three years ago, a female with a mental disorder jumped to her death from her residential block.
“Time heals all wounds,” notes Hong Kong property speculator and blogger Mo Yu-Wen. “As time goes on, though, fewer and fewer people will remember what happened and the value will go up again.” This means good news to rich investors who can afford to wait until the mystery and negative vibes linked to an ill-fated property they own subside.