Hong Kong people are an open-minded lot and do not shy away from discussing sensitive issues openly.
But the property market is one exception. Everyone is involved in property to some extent and everyone is convinced the prices of flats and offices can only go up. You would not do well to suggest otherwise.
The property philosophy has served its followers well in Hong Kong. The latest bull market, which began in 2007 and has reached record levels after a brief pause in the financial crisis, is now at record levels, having bettered the prices of 1997 before the transfer of Hong Kong from Britain to China.
So the Barclays Bank analyst who had the temerity to suggest the bull in the territory's property is on its last legs and prices will probably decline by 30 per cent by the end of next year has been greeted with a chorus of protests.
But it is increasingly evident the property boom has little substance.
The latest bull market is a strange situation, coming at a time when real wages in the Hong Kong economy are stagnant and economic growth only average.
It is unlike the bull market of the 1990s, which occurred when real wages were rising and the economy, anticipating the boom in China's economy, was also flourishing.
The current bull is almost entirely driven by liquidity and due more to the US Federal Reserve than internal factors.
When the financial crisis began in 2008, the Hong Kong market fell on fears of a worldwide depression and on the expectation that the well-heeled investment bankers who rent expensive flats in the city would be retrenched.
But then Ben Bernanke, the chairman of the Fed, came to the rescue with his printing presses, releasing a rush of dollars that hit Hong Kong harder than the other Asian cities.
The Hong Kong currency has been pegged to the US dollar at HK$7.75 since the mid-1980s, so investors can spend without worrying about exchange rate risk with the greenback.
This, plus the fact that Hong Kong has probably the most liquid property market in Asia and no capital gains taxes, means the territory's property became the best place to "park" the excess liquidity the Fed was pumping into the system. So despite the financial crisis and the tepid local economy, Hong Kong property prices shot through the roof.
The local banks did their part to fuel the speculation. Despite the ample liquidity, the commercial demand for loans was not there because of the lacklustre economy.
So the banks started pushing mortgages at rates as low as 1 per cent. This is low, but still higher than the deposit rates that were almost zero, thanks to the Fed's "hot money". The international speculators and some of the locals jumped on the bandwagon, pushing up prices of "luxury flats" in Hong Kong, which in some places would qualify as large closets.
Now there are unmistakable signs the interest rate cycle is turning, with the European Central Bank raising rates for the first time since 2008, and fears are that Hong Kong prices may collapse as quickly as they went up.
Its banks have also been raising mortgage rates for the first time in three years, albeit to only about 1.5 per cent, but that is only the first in a series soon to come.
So visitors to Hong Kong are well advised not to raise the topic of a declining property market if they are interested in enjoying their stay.
business@thenational.ae
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If you go
Where to stay: Courtyard by Marriott Titusville Kennedy Space Centre has unparalleled views of the Indian River. Alligators can be spotted from hotel room balconies, as can several rocket launch sites. The hotel also boasts cool space-themed decor.
When to go: Florida is best experienced during the winter months, from November to May, before the humidity kicks in.
How to get there: Emirates currently flies from Dubai to Orlando five times a week.
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How to protect yourself when air quality drops
Install an air filter in your home.
Close your windows and turn on the AC.
Shower or bath after being outside.
Wear a face mask.
Stay indoors when conditions are particularly poor.
If driving, turn your engine off when stationary.
Pad Man
Dir: R Balki
Starring: Akshay Kumar, Sonam Kapoor, Radhika Apte
Three-and-a-half stars
UPI facts
More than 2.2 million Indian tourists arrived in UAE in 2023
More than 3.5 million Indians reside in UAE
Indian tourists can make purchases in UAE using rupee accounts in India through QR-code-based UPI real-time payment systems
Indian residents in UAE can use their non-resident NRO and NRE accounts held in Indian banks linked to a UAE mobile number for UPI transactions
Summer special
Results:
5pm: Baynunah Conditions (UAE bred) Dh80,000 1,400m.
Winner: Al Tiryaq, Dane O’Neill (jockey), Abdullah Al Hammadi (trainer).
5.30pm: Al Zahra Handicap (rated 0-45) Dh 80,000 1,400m:
Winner: Fahadd, Richard Mullen, Ahmed Al Mehairbi.
6pm: Al Ras Al Akhdar Maiden Dh80,000 1,600m.
Winner: Jaahiz, Jesus Rosales, Eric Lemartinel.
6.30pm: Al Reem Island Handicap Dh90,000 1,600m.
Winner: AF Al Jahed, Antonio Fresu, Ernst Oertel.
7pm: Al Khubairah Handicap (TB) 100,000 2,200m.
Winner: Empoli, Pat Dobbs, Doug Watson.
7.30pm: Wathba Stallions Cup Handicap Dh80,000 2,200m.
Winner: Shivan OA, Patrick Cosgrave, Helal Al Alawi.
Nayanthara: Beyond The Fairy Tale
Starring: Nayanthara, Vignesh Shivan, Radhika Sarathkumar, Nagarjuna Akkineni
Director: Amith Krishnan
Rating: 3.5/5
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The specs
Engine: 77.4kW all-wheel-drive dual motor
Power: 320bhp
Torque: 605Nm
Transmission: Single-speed automatic
Price: From Dh219,000
On sale: Now
The specs
Engine: 3.9-litre twin-turbo V8
Power: 620hp from 5,750-7,500rpm
Torque: 760Nm from 3,000-5,750rpm
Transmission: Eight-speed dual-clutch auto
On sale: Now
Price: From Dh1.05 million ($286,000)
Electoral College Victory
Trump has so far secured 295 Electoral College votes, according to the Associated Press, exceeding the 270 needed to win. Only Nevada and Arizona remain to be called, and both swing states are leaning Republican. Trump swept all five remaining swing states, North Carolina, Georgia, Pennsylvania, Michigan and Wisconsin, sealing his path to victory and giving him a strong mandate.
Popular Vote Tally
The count is ongoing, but Trump currently leads with nearly 51 per cent of the popular vote to Harris’s 47.6 per cent. Trump has over 72.2 million votes, while Harris trails with approximately 67.4 million.
The Orwell Prize for Political Writing
Twelve books were longlisted for The Orwell Prize for Political Writing. The non-fiction works cover various themes from education, gender bias, and the environment to surveillance and political power. Some of the books that made it to the non-fiction longlist include:
- Appeasing Hitler: Chamberlain, Churchill and the Road to War by Tim Bouverie
- Some Kids I Taught and What They Taught Me by Kate Clanchy
- Invisible Women: Exposing Data Bias in a World Designed for Men by Caroline Criado Perez
- Follow Me, Akhi: The Online World of British Muslims by Hussein Kesvani
- Guest House for Young Widows: Among the Women of ISIS by Azadeh Moaveni
Titan Sports Academy:
Programmes: Judo, wrestling, kick-boxing, muay thai, taekwondo and various summer camps
Location: Inside Abu Dhabi City Golf Club, Al Mushrif, Abu Dhabi, UAE
Telephone: 971 50 220 0326
COMPANY PROFILE
Founders: Alhaan Ahmed, Alyina Ahmed and Maximo Tettamanzi
Total funding: Self funded
THE SPECS
Engine: 6.75-litre twin-turbocharged V12 petrol engine
Power: 420kW
Torque: 780Nm
Transmission: 8-speed automatic
Price: From Dh1,350,000
On sale: Available for preorder now
SPECS
Engine: 4-litre V8 twin-turbo
Power: 630hp
Torque: 850Nm
Transmission: 8-speed Tiptronic automatic
Price: From Dh599,000
On sale: Now
MATCH INFO
Austria 2
Hinteregger (53'), Schopf (69')
Germany 1
Ozil (11')
Milestones on the road to union
1970
October 26: Bahrain withdraws from a proposal to create a federation of nine with the seven Trucial States and Qatar.
December: Ahmed Al Suwaidi visits New York to discuss potential UN membership.
1971
March 1: Alex Douglas Hume, Conservative foreign secretary confirms that Britain will leave the Gulf and “strongly supports” the creation of a Union of Arab Emirates.
July 12: Historic meeting at which Sheikh Zayed and Sheikh Rashid make a binding agreement to create what will become the UAE.
July 18: It is announced that the UAE will be formed from six emirates, with a proposed constitution signed. RAK is not yet part of the agreement.
August 6: The fifth anniversary of Sheikh Zayed becoming Ruler of Abu Dhabi, with official celebrations deferred until later in the year.
August 15: Bahrain becomes independent.
September 3: Qatar becomes independent.
November 23-25: Meeting with Sheikh Zayed and Sheikh Rashid and senior British officials to fix December 2 as date of creation of the UAE.
November 29: At 5.30pm Iranian forces seize the Greater and Lesser Tunbs by force.
November 30: Despite a power sharing agreement, Tehran takes full control of Abu Musa.
November 31: UK officials visit all six participating Emirates to formally end the Trucial States treaties
December 2: 11am, Dubai. New Supreme Council formally elects Sheikh Zayed as President. Treaty of Friendship signed with the UK. 11.30am. Flag raising ceremony at Union House and Al Manhal Palace in Abu Dhabi witnessed by Sheikh Khalifa, then Crown Prince of Abu Dhabi.
December 6: Arab League formally admits the UAE. The first British Ambassador presents his credentials to Sheikh Zayed.
December 9: UAE joins the United Nations.
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Disclaimer
Director: Alfonso Cuaron
Stars: Cate Blanchett, Kevin Kline, Lesley Manville
Rating: 4/5
Business Insights
- As per the document, there are six filing options, including choosing to report on a realisation basis and transitional rules for pre-tax period gains or losses.
- SMEs with revenue below Dh3 million per annum can opt for transitional relief until 2026, treating them as having no taxable income.
- Larger entities have specific provisions for asset and liability movements, business restructuring, and handling foreign permanent establishments.
Killing of Qassem Suleimani
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The biog
Favourite Emirati dish: Fish machboos
Favourite spice: Cumin
Family: mother, three sisters, three brothers and a two-year-old daughter
Killing of Qassem Suleimani
Indoor Cricket World Cup - Sept 16-20, Insportz, Dubai
Kanguva
Director: Siva
Stars: Suriya, Bobby Deol, Disha Patani, Yogi Babu, Redin Kingsley