With summer upon us, the rental market is nearing its traditional peak season, when an increase in leasing demand is underpinned by university students seeking accommodation, especially those who have not been able to secure a dormitory space on campus premises.
Rents of properties near campuses rise as local students, as well as those from the mainland and overseas, seek out flats.
Earlier this month, two mainland students rented a 347-square-foot unit at Wuhu Residence in Hung Hom for HK$10,000 a month, or HK$28.80 per sq ft per month. That comes to HK$5,000 per month per student, not counting rates, management fees and other costs.
The residential project is quite popular with students of Hong Kong Polytechnic University. Of the 100 units, more than 40 have been leased, with five to six taken by PolyU students.
Another six students at the university rented a 770-sq-ft-unit at Harbour Place, also in Hung Hom, for a monthly rent of HK$17,800, or HK$23 psf per month. That works out at an average of almost HK$3,000 per student per month.
Demand for places at halls of residence has always been strong. According to data from the University Grants Committee, every dormitory space draws the interest of more than one student. The committee is set to provide another 6,600 spaces before the new academic year starts in September.
In the 2011/12 academic year, places at halls of residence were allocated to 26,676 local and nonlocal students - 25,541 are in UGC-funded courses while the remaining 1,135 are pursuing self-financing programs, according to data presented to legislators in March.
More than 15,000 local students were allocated places, while in excess 14,680 nonlocal students applied for student hostels, but only 11,651 secured places.
The highest number of nonlocal applicants - 3,646 - came from the University of Hong Kong.
Residences on campus at PolyU rent for HK$1,400 per month. At the Hong Kong University of Science and Technology, students pay at least HK$1,580 per month. Students normally have to rent for one term at least, or about five months.
Four teaching assistants from the mainland rented a 900-sq-ft three- bedroom flat at Lohas Park in Tseung Kwan O for HK$12,500 per month, or HK$13.90 psf per month.
"There is a big shortage of dormitories at the Hong Kong University of Science and Technology in Clear Water Bay. So flats nearby, especially those in Tseung Kwan O, are very popular with students," said Alvin Ma, chief district manager at Midland Realty.
"The demand will rise further in July and August as more mainland students arrive in Hong Kong. The rental market will be more active then."
However, it is hard to say by how much rents will be lifted by the demand.
Sha Tin is also a popular district with students. Two mainland students rented a 395-sq-ft unit at City One Sha Tin for HK$9,000 per month, or HK$22.80 psf per month, according to realtors.
Sha Tin is two MTR stations away from Kowloon Tong, where both Hong Kong Baptist University and City University of Hong Kong are located.
"A lot of homeowners would prefer students too, as most of them can pay higher rents, which boosts the rental return," said Chan Wing-keung, a senior branch manager at Centaline Property Agency.
But since students are unable to provide any proof of income most of the time, landlords will ask many of them to pay a year's rent in advance before being allowed possession of a flat.
Some real estate agents are holding roadshows at universities to attract business. Midland Realty - for the first time - pitched its offerings at HKUST earlier this year.
The roadshows were meant to help graduate students from the mainland and overseas rent accommodation.
Students normally plan to pay HK$3,000 to HK$4,000 a month for accommodation, Ma said, adding that the amount is enough for a flat near Tseung Kwan O if two or more students are willing to share.
Even developers are trying to tap into the market. Earlier this month, Cheung Kong (Holdings) (0001) promoted The Beaumount, its latest residential project in Tseung Kwan O, at HKUST, Baptist University, CityU, Chinese University of Hong Kong and PolyU.
"There are 54,000 university students every year, but there are only 20,000 university accommodation spaces a year. So the market is huge," said Cheung Kong Real Estate executive director William Kwok Tsz-wai.
The Beaumount offers 1,777 two- and three-bedrooms apartments, with sizes ranging from 650 to 1,000 sq ft.
The developer has set up a platform, "Easy Renting," to help students find flats at the project through the four major realtors. The platform also aims to attract investors.
However, it is also believed that this is a channel to attract wealthy parents, especially those from the mainland, who may buy flats for their children who have been accepted at local universities.