It is a well-known fact that property prices in Hong Kong are expensive and usually beyond the reach of ordinary citizens who hold 9-5 jobs as waiters or secretaries. It has become expensive to the point where if you were to ask an existing property owner advice on private property ownership as a young fresh university graduate, their words will probably be along the lines of “Good luck!”
However, for those who currently own a piece of private property with a mortgage, your eyes are probably set on when[/if] the Fed will increase interest rates. This is expected to cause an at least semi-proportional increase in interest rates in Hong Kong, thereby translating to mortgage rates. This may cause the existing shortage of affordability of housing to go increase, and if the Hong Kong property market has been going up for the past 12 years, are we approaching a[nother] bubble?
I would argue we are well past bubble territory and that the bubble has been building extra layers of skin that will make it impenetrable to traditional housing bubble facts. While there may be concrete concern of affordability, I believe house prices in Hong Kong are set to go continue rising, unless China enters some form of economic recession.
My motivation to write this quick opinion on private ownership of property concerns a piece of Karl Marx I have been reading that has consequences on the affordability of housing in the future for current 20-30 year olds in Hong Kong who have either immigrated to Hong Kong or are looking to make a private property purchase of their own. I believe the next 5-10 years will clear up why Thomas Piketty was not able to directly refer to Patrimonial Capitalism as Patrimonial Socialism.
It is not the free market that has allowed the ownership of private property to be successive through generations of family, but lax regulations, lack of oversight on trusts and inheritance, and many other factors. However, if our next generation of policy makers and deciders potentially come from impoverished backgrounds who seek to ‘correct’ the ‘system’, we may see a more equal opportunity to property ownership, such that we eradicate what Marx refers to as “the whole of society must fall apart into the two classes – property owners and property-less workers.”
The below is the first paragraph of Estranged Labour from the section of First Manuscript of Marx’s Economic and Philosophical Manuscripts of 1844:
- We have proceeded from the premises of political economy. We have accepted its language and its laws. We presupposed private property, the separation of labor, capital and land, and of wages, profit of capital and rent of land – likewise division of labor, competition, the concept of exchange value, etc. On the basis of political economy itself, in its own words, we have shown that the worker sinks to the level of a commodity and becomes indeed the most wretched of commodities; that the wretchedness of the worker is in inverse proportion to the power and magnitude of his production; that the necessary result of competition is the accumulation of capital in a few hands, and thus the restoration of monopoly in a more terrible form; and that finally the distinction between capitalist and land rentier, like that between the tiller of the soil and the factory worker, disappears and that the whole of society must fall apart into the two classes – property owners and property-less workers.