September is characterised by parents making last-minute dashes to iron out school uniforms and stock up on supplies. But education-obsessed tiger moms and helicopter parents have one other thing to worry about: getting their children into their preferred school districts, which oddly provides a catalyst for the city’s red-hot property market.
Two years ago, the Lui family had grand plans. Determined to stay within the boundaries of the city’s most highly regarded school district, parents of 5-year-old daughter Mimi moved all the way from remote Tin Shui Wai to Sham Shui Po, then Kowloon City, spending a hefty $8 million on a 751-square foot flat. Two months ago, their dream was shattered. Entirely. Mimi was admitted to a school in Wong Tai Sin, neighbouring Kowloon City. “Everything’s over,” laments Mrs Lui.
The Lui family is far from alone in a city where admission to an elite school can cost as much as an apartment. It’s an open secret eager parents blatantly misuse addresses to gain entrance to their favourite schools. Others splash out on living temporarily in one of those ideal school districts. For international schools operated by the ESF, the area you live in dictates which school you would be eligible to apply for.
Gill Keefe, national director of residential leasing and relocation with Jones Lang LaSalle, says Island South, Mid-Levels, Pokfulam and, increasingly, Sai Kung are popular among expatriate home seekers, while Braemar Hill, Quarry Bay, Mid-Levels West and Kowloon Tong are prestigious local school districts.
Kowloon Tong probably tops the city’s list of best school districts. During the heyday of the colonial era, many wealthy expat families chose to settle in this high-end neighbourhood. Now an education hub, it is home to some prestigious pre-schools and a cluster of international schools, including Australian International School and King George V School in its hinterland, Ho Man Tin.
June through August is often a boom time for the rental market in these “best” school districts, realtors say. “The summer is the peak season for local moves as well as expatriate moves both in and out of Hong Kong,” Keefe says. “This ties in with the beginning of the academic year for most schools, which generally occurs between the second half of August and the first week of September.”
The summer uptrend is driven not only by anxious parents but also college-bound students scrambling for flats. In July, a major housing estate in Shatin, thanks to its proximity to the Chinese University of Hong Kong, faced a shortage of rental apartments. Of 108 leasing transactions at City One, half are from university students from Mainland Chinese, data from Midland Realty shows.
According to Centaline, other top rent performers include Island West’s Kennedy Town. In this back to school season, a 297-square foot shoebox flat at Smithfield Terrace, which is a 10-minute walk from the University of Hong Kong, can fetch a monthly rental of up to $12,000, or $40 per square foot, compared to $43.8 in Mid-Levels.
Tucked away from the city’s hustle and bustle, remote Tuen Mun, the second cheapest suburb in the New Territories, is a rising star, with prices up 15 percent over the past year. The September opening of the everaristocratic Harrow International School — which has produced eight UK prime ministers including Winston Churchill — is spurring unprecedented interest in that distant part of the city.
Executive headmaster J Mark Hensman earlier stated that the UK boarding school — charging an annual tuition fee of about $150,000 (excluding boarding fees) — gives admission priority to primary students from Tuen Mun. Excited by the news, wealthy families have been moving to the area in preparation for the new school term, brokers say. Luxury flats sized bigger than 1,500 square feet at Aqua Blue, Aegean Coast and Beaulieu Peninsula have been new targets.
Alternatively, Avignon, a low-density luxury development, has seen about one-third of its leasing transactions come from Harrow’s teaching staff and parents, says Brian Tam, a district sales manager with Centaline Property. A 3,060-square foot French-style Avignon villa rents for $75,000, or $24.5 per square foot, compared to the city’s average of $20.7 in July. Early birds are even able to make a handsome profit, Tam adds. A threebedroom 1,268-square foot flat at Bellagio now reaches $9.8 million, up 48 percent from four years ago.
However, some are less convinced of the “Harrow effect” in the boondocks far from the heart of Hong Kong. “There will undoubtedly be some increased interest in property in the area although school buses will run from many areas around Hong Kong,” theorises Keefe, who thinks the city’s convenient transport network increases mobility. “Most schools offer school buses. This then offers flexibility for where a family can live as the children can go to school by bus and do not have to live around the corner from the school.”
So is it worthwhile to invest in a prime school district home? Realtors say investors enjoy the stabilising effect of good schools and can look for a yield from 2 percent up these days. “Demand for flats in good school districts is usually stronger. That’s why popular residential districts are usually attractive options for investment,” Keefe says. “But for some locations such as Chai Wan, Shau Kei Wan and Aberdeen, you wouldn’t expect expatriates to live there though international schools are available.”
Looking ahead, the race for homes near top schools is unlikely to cease. “New residential developments in good school districts are usually sough-after,” Keefe adds. There have been a few new developments in the Mid- Levels West area, such as Swire’s Azura and Argenta on Seymour Road — all surrounded by dozens of international and local elite schools. As for the Lui family, nothing is going to prevent them from getting their second daughter, YoYo, into an elite school in Kowloon City. “We’re hoping the principal will remember us and give us a chance,” Lui says.