🏠 Top 10 Property Market Myths: Is it true that buying a property means "getting it first and having a future"?

In Hong Kong, the property market is practically a national hot topic. From commuting to work, to dinners, to family gatherings, the constant question is, "Have you bought a home yet?" and "When are you going to buy one?" For many Hong Kongers, buying a home is a life goal, but is there really no losing in the property market? Today, we'll debunk "Ten Property Market Myths" and analyze the truth behind each one, so you can approach the market rationally instead of blindly following trends.

🔟 Property Market Myth 1: Property Prices Will Always Go Up📈

• Myth debunked : Hong Kong property prices have been rising for a long time, but that doesn’t mean they won’t fall.
• Fact : From the 1997 financial crisis to 2003, housing prices fell by more than 60%; from 2019 to 2023, housing prices also fell significantly due to the impact of US interest rate hikes and the epidemic.
• Revelation : The market may rise in the long term, but will experience large fluctuations in the short term. Don’t blindly believe that it will only rise.

9️⃣ Myth 2: Buildings come first and the future is yours🏡

• Myth interpretation : The social atmosphere makes people feel that not owning a home means they have no security.
• Fact : Real estate is an asset class, but it's not suitable for everyone. Some people choose to rent a property, keeping their funds flexible for investing in stocks and mutual funds, which can yield better returns.
• Revelation : There is more than one path to choose in life, and you should not be tied to "getting on the bus".

8️⃣ Myth 3: Being able to afford something means you can buy it💸

• Myth : Many people calculate their mortgage payments daily, thinking that as long as they can afford the monthly payments, there will be no problem.
• Fact : Besides mortgage payments, buying a property also involves a down payment, stamp duty, legal fees, management fees, and maintenance costs. Long-term interest rate hikes are also a concern.
• Lesson learned : Buying a property isn’t just about calculating the monthly mortgage payments; it’s also about considering your cash flow.

7️⃣ Myth 4: Renting is a waste of money💰

• Myth : The rent is paid out without any return, just like "helping the owner to pay the mortgage."
• Fact : Renting allows for flexibility and eliminates the need to bear the long-term burden of mortgage payments. Furthermore, some people use their funds to invest in other assets, which yield higher returns than mortgage payments.
• Revelation : Renting a property is not necessarily a waste; it can be a financial strategy.

6️⃣ Myth 5: Buying a small unit will increase the value of the property 📏

• Myth interpretation : Small units are easy to get into, popular among young people, and have a large market demand.
• Fact : Small units are generally more expensive per square foot, and policies (such as mortgage restrictions) may suppress investment value.
• Lesson : Don’t buy a property solely on the assumption that smaller units will appreciate in value; you need to analyse supply, demand and policy.

5️⃣ Myth 6: Buying a property is definitely better than investing in stocks📊

• Myth interpretation : The real estate market is stable, while the stock market is volatile.
• Fact : Although the property market is relatively stable, it has low liquidity and a high entry threshold, while stocks have the advantage of diversified investment.
• Lesson : Don’t make a single comparison; the most ideal approach is asset allocation, with properties and stocks each having their own roles.

4️⃣ Myth 7: The government will definitely maintain the property market🏦

• Myth debunked : The Hong Kong government's fiscal revenue mostly comes from land sales, so the property market will not collapse.
• Fact : The government can regulate through policies, but if an external financial crisis occurs, the property market will still plummet.
• Significance : Don’t rely too much on government support for the market, as the market always has its own rules.

3️⃣ Myth 8: Buying a property means securing your retirement 👩🦳👨🦳

• Myth debunked : You can live off rent in retirement.
• Fact : After deducting management fees, maintenance costs, and vacancy period from the rent, the actual return may be only 2-3%. In addition, with an aging population, there is a high demand for small units, but luxury homes may not be easy to rent out.
• Lesson learned : Retirement protection needs to be diversified and cannot rely solely on property.

2️⃣ Myth 9: Buying a property means you belong to the upper class🏙️

• Myth : Owning a house represents social status and success.
• Fact : Buying a property is an asset purchase, not a guarantee of financial freedom. Owning a property while still carrying a heavy debt burden doesn't necessarily mean a higher quality of life.
• Revelation : Don’t equate buying a property with your life values.

1️⃣ Myth 10: You shouldn’t buy if the property market is falling📉

• Myth interpretation : People jump into the market during a down market and then it falls again, so they choose to wait and see.
• Fact : Historical data shows that falling markets are often good opportunities to enter the market. For example, if you bought in during the SARS outbreak in 2003, the market would have appreciated several times by 2018.
• Lesson : Focus on long-term value, not short-term fluctuations.

🧐 Editor's Summary

There are many myths surrounding the Hong Kong property market, some inherited from past generations and some shaped by market sentiment. But the truth is: buying a property doesn't guarantee success, and renting doesn't guarantee failure. While Hong Kong property prices have long been high, they are influenced by complex factors, including supply and demand, policies, interest rates, and the global economy.

My final words: Buying a home should be a personal choice combined with financial planning , not social pressure. Don't blindly believe the saying, "Owning a home means having a future." Your true future depends on how you manage your assets and how you live, not just on owning a home. ✨