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Prices of haunted flats levitate in line with HK property market
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Ng Goon-lau pointed at a window inside a dark, tiny bedroom. The window was small and easily sealed, Ng explained, a perfect place for carbon monoxide poisoning.
A man once burned charcoal to kill himself there. Another tenant, a policewoman, also hanged herself in the same apartment.
鈥淭hat鈥檚 why it was so cheap,鈥 said Ng, the silver-haired 66-year-old landlord, who bought the tiny 30.19-square- meter unit after the double suicides for just over HK$1 million (US$127,400) in 2010, 30 percent below the then market rate.
Eight years later, the apartment is probably worth around HK$4.4 million, Ng estimates.
Dubbed the 鈥淜ing of Haunted Flats鈥 by local media, Ng has made a name for himself for speculating on such 鈥渉ongza,鈥 or haunted flats defined here as the places where tragedies, such as suicides and murders, took place. He has been able to buy some of the homes at as much as a 40 percent discount.
But Hong Kong鈥檚 record-breaking property price surge over the past few years is pushing many to reconsider such inauspicious apartments as bargains too good to pass up, whatever the bad history.
The once heavy discount on a haunted apartment鈥檚 price has narrowed from about 30 percent in 2013, to about 10 percent this year, said Ng, adding the discount dropped at the fastest rate in the past year.
鈥淭he market is crazy now, there is so much demand,鈥 the former shark鈥檚 fin salesman said. 鈥淏uying an unlucky flat is now a very practical way to own a house, so competition is fierce.鈥
The financial hub鈥檚 housing prices have been on a record-breaking run for 18 consecutive months, with the city now one of the world鈥檚 most expensive real estate markets.
A skilled service worker would need to work 20 years to buy a 60.39-square-meter flat near the city center, according to a UBS report in September, which also ranks Hong Kong鈥檚 housing market as the least affordable in a list of 20 world cities.
Only about 20 percent of Hong Kong鈥檚 1.85 million taxpayers could afford to buy a medium-priced apartment costing HK$8 million, property consultancy Knight Frank said this month.
Property analysts expect prices to rise even further this year, with five analysts predicting overall gains of between 8 percent and 17 percent.
Even Ng, who has bought around two dozen haunted flats since the 1990s and flipped most of them for profit, is spooked by the market surge.
A double whammy of high prices and a heavy tax on non-first time buyers means he hasn鈥檛 bought a haunted flat for six years.
The amateur unicyclist isn鈥檛 looking to sell either, describing his existing portfolio as 鈥減earls and treasures.鈥
Even for public housing, where the average waiting time is five years given limited supply and strong demand in one of the most densely populated cities in the world, many are flocking to a separate 鈥渆xpress鈥 queue for less desirable apartments. These include, according to the Housing Authority鈥檚 website, those 鈥渋nvolved in unpleasant incidents.鈥
Last September, the government received more than 80,000 applications for 576 such flats.
The issue of a haunted flat melds the Hong Kong obsession with property with a Chinese population that tends to be superstitious and pursues ancient traditions, illustrated by the use of feng shui by many property developers to ensure that a building uses surrounding natural forces, such as mountains, wind and water, in a harmonious way.
Not only does a haunted flat drag down the price of all the flats on the same floor, it can also bring down the value of apartments above and below it, according to property agents.
It is commonly believed here that the trapped souls of murder victims are especially haunting, as they linger in humankind, mourning their untimely, vicious deaths and yearning to complete what they did not have time to do while they were alive.
A flat a few doors down from the apartment where former British banker Rurik Jutting murdered two women in 2014 was sold last year. The price dropped 6 percent from its previous transaction in 2011, even though Hong Kong鈥檚 housing market rose more than 80 percent during the same period.
The buyer could not be reached for comment. Jutting鈥檚 former landlord declined to be interviewed.
鈥淲e live in a traditional Chinese society,鈥 said a property agent who did not want to be named. 鈥淔or some people it is a psychological hurdle, and they won鈥檛 feel comfortable living in an unlucky flat.鈥
Banks are also less willing to provide mortgages for a haunted home due to concerns it could be difficult to resell in the event of a mortgage default, according to the managing director of Centaline Mortgage Broker Limited, Ivy Wong.
But while some banks unilaterally rejected 鈥渉ongza鈥 mortgage applications a decade ago, in recent years this policy has been relaxed.
鈥淲hen more home buyers are willing to accept these flats, it gives the banks more confidence,鈥 Wong said.
HSBC provided a mortgage for a buyer last year when she bought one of Hong Kong鈥檚 most notorious homes 鈥 a Tsuen Wan apartment where a man killed his six relatives when he attempted suicide by gas in 1996, according to Land Registry records.
There are unofficial websites which keep detailed records of the thousands of haunted homes in the city.
Similar websites tracking haunted homes exist in Taiwan and Japan, and a Canada-based website lists haunted and murder homes in North America.
Hong Kong property agents aren鈥檛 legally obliged to disclose if a flat is 鈥渉aunted鈥 but they are bound by a code of ethics under the city鈥檚 Estate Agents Authority, which has the power to issue and revoke licenses.
鈥淚 was not afraid at all,鈥 said Jenny Yuen, who once rented one of Ng鈥檚 haunted flats when she first moved to Hong Kong from the mainland.
鈥淓verybody dies. It鈥檚 a very natural thing.鈥
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