| Abstract | It has been almost one complete cycle of the Chinese calendar since the last time real-estate prices in Hongkong collapsed. The crash of 1983 - which took several public companies with it - came about because interest rates got so high that buyers could no longer afford to finance their mortgages. In the ensuring 12 years that simple truth has been all but forgotten, as we have watched residential real estate prices go up sixfold, while household incomes roughly quadrupled. Since 1989, residential property has tripled in price while salaries have merely doubled. This calls for examination of the "affordability" factor. |
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