One of the World’s Most Expensive Luxury Property Markets Is Becoming a Lot Cheaper
Hong Kong’s superluxury homes have lost more than a quarter of their value. Prices haven’t hit the bottom yet.
3 min
China’s economic slowdown is wreaking havoc on Hong Kong’s luxury property market .
The most expensive homes in the city are changing hands at steep discounts to what they were worth just a few years ago. Chinese property tycoons, struggling to contain the fallout of their collapsing business empires, have become forced sellers. Bank lenders are seizing properties after luxury homeowners miss loan payments.
The average selling price of superluxury homes, defined as those worth more than the equivalent of $38 million, has fallen by more than a quarter since the middle of 2022, said Cherrie Lai, senior director and head of residential sales in Hong Kong at Savills . It will fall further this year as sellers accept reduced prices to cash out quickly, she said.
The slide in prices shows the fallout of China’s sputtering economy, which is suffering from deflation , slowing exports and moribund consumer confidence. A continuing real-estate slowdown in China is proving particularly painful, since the country’s big-spending property magnates were behind some of Hong Kong’s biggest luxury-property deals in recent years.
Hong Kong’s property market has also been squeezed by rising interest rates in the U.S. The Hong Kong dollar is pegged to the U.S. dollar, and the city’s de facto central bank matches Federal Reserve interest-rate increases. But the U.S. market has held up much better: Nine-figure home sales in places such as California and Florida have skyrocketed , and luxury-home prices in the top 5% of the U.S. market have soared over the past decade.
The luxury homes up for grabs in Hong Kong include three mansions linked to collapsed real-estate company China Evergrande , said Victoria Allan, founder of Habitat Property. Local media reported they were ultimately owned by Hui Ka Yan , the company’s founder.
The three properties, which are adjacent mansions on a hillside road known as Black’s Link, have been seized by creditors. House 10B was sold for about $115 million in 2019 but it is now valued by banks at roughly $55 million, said Allan. It has yet to find a buyer. The other two properties could be put on the market next month, she said.
Chen Hongtian, the mainland-Chinese founder of property-investment firm Cheung Kei Group, bought a luxury high-rise apartment occupying an entire floor in a building designed by architect Frank Gehry in 2015, paying about $49.5 million. It was later seized by a creditor, according to official records. In September, shipping magnate Kwai Sze Hoi bought the property for $53.4 million, records show, below what property agents said was a market valuation of about $87 million at the time.
Homes seized by creditors usually sell at a discount to market prices, property agents say.
A waterfront house at Residence Bel-Air, a luxury residential development, belonged to Mai Fan , the chief executive of Kaisa Group —another developer that defaulted as China’s property crisis widened in recent years. He acquired the house through a company called Million Link Development in 2017, corporate and land records show, at a time when property prices were still climbing. Receivers were appointed to handle the property in 2021 and sold the house the following year for about $46 million, according to the land registry.
In one of Hong Kong’s top sales in recent years, a local businessman sold his house for the equivalent of about $107 million last month, well below the initial asking price of $166 million, according to Savills. It is located on Hong Kong’s Victoria Peak, a mountaintop neighborhood that is home to business moguls and celebrities living in some of the city’s most expensive properties.
“China still has very wealthy people, but they’re a different group now,” said Victor Cheng, a realtor in Hong Kong. “They’re not the highflying property moguls but those who may not have made as much when China grew rapidly but whose businesses grew steadily.”
He said the new breed of luxury-home buyer in Hong Kong is cash-rich and less likely to load up on debt.
Some mainland Chinese homeowners have been forced or pressured to sell—often at around 20% below market prices—because they need cash to pay off debt, said Cheng. Some top executives from the mainland previously bought trophy homes and only used them occasionally without renting them out, he said.
Data analysed by online real-estate marketplace Spacious.hk suggest a tougher time ahead for luxury homes. The number of sale inquiries on the platform for homes priced at the equivalent of $10 million or above fell 45% in the past 12 months, said Spacious.hk Chief Operating Officer James Fisher. Inquiries for homes under $1.3 million and for those priced between that and $3.2 million fell by 8% and 25%, respectively.
The price index for private homes slumped to a seven-year low by the end of 2023, according to Hong Kong’s Rating and Valuation Department.
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A vibrant 1954 Palm Springs home featuring eight colorful murals by late artist Shawn Savage is on the market for $2.295 million. The 2,237-square-foot property features bold hot-pink doors, three bedrooms, a pool, mountain views and playful interiors blending modern glamour with classic Palm Springs style.
3 min
A bold 1950s home in Palm Springs, California, adorned with eight colorful murals by the late artist Shawn Savage, is coming to market ahead of the city’s annual Modernism Week.
The white stucco home on El Camino Way, built in 1954 and recently renovated, has an asking price of $2.295 million. Its staggered facade features three playfully abstract murals on either side of double-height hot pink doors.
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The sellers are Los Angeles-based partners John Freeman and Mathieu Faure, who knew it was “the one” when they saw it after several months of searching in the winter of 2023. “It’s a happy house,” Freeman said. “We really liked the feel of the house: the uniqueness, the openness, the brightness—and the art.”
Located in the Mesa neighborhood of Palm Springs, which backs up to the San Jacinto Mountains, the 2,237-square-foot house features three bedrooms, an angled bonus room and a yard with a pool, desert mountain views and another colorful mural running alongside the pool.
“I never thought in my life I would have a house with pink doors,” said Faure, a producer at Apple TV who is originally from Paris. “It’s so colorful, it’s so different. And so Palm Springs.”
The layout of the home creates a smooth flow from the front doors through the open-plan common area—a foyer, bar, and living and dining room—into the kitchen around a fireplace wall and out to the yard. A corridor leads to a private bedroom wing, where the primary suite has floor-to-ceiling windows and the primary bath is only a tad smaller than the bedroom.
Faure has filled the home with Jonathan Adler furniture, rugs and accessories, riffing on the energetic California vibes of the house to create an aesthetic of “modern American glamour,” he said.
“It was enjoyable for me to play with different types of furniture and make this house ‘happy chic,’ as I describe it,” he said.
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“He did a fantastic job,” said Freeman, who is an attorney and consultant. “It does kind of bring a smile to my face whenever I walk into the house.”
Since the furniture and decor were chosen for the particularities of the space, the couple is open to selling them with the home. Their West Hollywood house is already furnished; the collection doesn’t match the vibes of a Houston loft they bought near family; and Faure can’t imagine these pieces in New York—where he’s lived in the past—he said.
The duo bought the Palm Springs house for $1.925 million in 2024, according to property records, and will list the home Monday. They are represented by Stewart Smith, Patrick Jordan and Kevin Stanley of Bennion Deville Homes/Luxury Portfolio International.
The previous owners had purchased the home in 2021 for $975,000 and then spent more than two years and $700,000 on the renovation, according to Realtor.com. They commissioned Savage, a local Palm Springs artist and painter known for his joyful abstract work, to decorate the home.
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Savage, who died in 2024, lived in the Coachella Valley from 2003, and his work can be found in various local institutions and is on exhibit at the Illumine Gallery in Palm Springs. “Some artists pass through a place. Shawn Savage became a part of it,” the gallery’s description states.
Unsurprisingly, the murals invite lots of friendly conversations, as well as guided tours and interested lookers, but never to a degree that it disturbed the peacefulness of their home or the neighborhood, the sellers said. “It felt like living in an art gallery, and you have the exterior that you would share with the world,” Faure explained.
The neighborhood also played a role in their decision to buy, because of its access to the hiking trails of the San Jacinto Mountains, the lack of through-roads and the neighborly environment.
“It’s a very friendly place,” Faure said.
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