Luxury-home prices in Hong Kong remained the second-highest worldwide for the sixth consecutive year last year, and are expected to rise steadily this year, property investment consulting firm Knight Frank reports.

Hong Kong was the most expensive place for luxury residential property in Asia, with $1 million buying just 22 square meters of accommodation, the Wealth Report 2018 compiled by Knight Frank showed.

Prices for the city’s prime properties grew 7.3 percent last year, taking Hong Kong to 17th place among 100 locations tracked by the company’s Prime International Residential Index, up from 38th in 2016.

This photo dated Jan 25, 2018 shows property in Sha Tin, Hong Kong. ( CHINA DAILY)

“As a financial hub, the price of luxury homes in Hong Kong is almost at the same level as New York and London, which means the growth is that rapid,” Knight Frank’s Greater China head of research and consultancy David Ji told on a press conference on Thursday.

Prime residential apartment prices in Hong Kong are expected to rise 7 to 8 percent on average this year, slower than the increase for ordinary properties, Ji added.

The report shows Guangzhou leads the ranking with an increase of 27 percent last year but there has been a notable slowdown in the Chinese mainland’s other first-tier cities. Shanghai and Beijing only registered growth of 9.2 percent and 7.3 percent respectively.

“Guangzhou’s high ranking shows the very strong purchase demand in the city against relatively weaker purchase restrictions, as across the nation policies are being tailored for each market,” Ji said. “The rapid growth in Guangzhou may affect the property policy in future.”

He pointed out that ultra-wealthy people see prime residential property as a way to store their wealth, particularly as a tool to counter inflation, and is one of their key investment channels.

The report also showed that the number of ultra-wealthy people, with net assets of $50 million or more, rose about 20 percent in Hong Kong last year to 5,140. The city ranks as the third-biggest economy for the ultra-rich in Asia, just behind the 9,960 in Japan and 8,800 on the Chinese mainland. Hong Kong has the second-highest concentration of wealthy globally, with 70 ultra-wealthy individuals per 100,000 people.

“The growth of ultra-wealthy people is mainly driven by the rising property prices and the strong stock market,” said Ji.

The report predicts the number of ultra-wealthy on the mainland would expand 104 percent in the coming five years, “with wealth increasingly being accumulated through new sources of growth including technology related industries”, said Nicholas Holt, Asia-Pacific head of research at Knight Frank.