Luxury Living on Lantau Island – 2023 Property Market Outlook

Lantau Island: An Outlying Gem of Hong Kong

As is well documented, Hong Kong as a territory is actually a collection of roughly 200 islands. While most Hongkongers live on Hong Kong Island or in Kowloon, more and more residents are taking advantage of the greenery and space of the SAR’s largest island: Lantau Island.

Lying to the west of Hong Kong and technically part of the Islands District, Lantau has evolved from a collection of scattered fishing villages into a diverse and growing destination in its own right. Major infrastructure projects and development plans to accommodate upwards of one million people are underway, including the Kau Yi Chau Artificial Islands project, and taken together will ensure Lantau Island is even more accessible than it already is.

Lantau Living: Why Property is Rising in Popularity

Lantau Island’s residential submarket is made up of four key areas: Tung Chung, Discovery Bay, Mui Wo, and South Lantau (around Cheung Sha, Tong Fuk, San Shek Wan, and Tai Long Wan).

All areas have seen a surge in property popularity, with each of them bearing a slightly different lifestyle offering and variety of residences:

1. Tung Chung located on the north-western side of Lantau Island, and is one of the most developed and easily accessible areas on the island, with direct MTR links and buses available at the town’s centre. Modern residential complexes and amenities make this spot ideal for urban dwellers who also want plentiful greenery, hiking trails, and cycling routes right at their doorstep.
2. Discovery Bay is reachable by ferry or bus, and has established itself as a self-sufficient community. The area is made up of private houses and low-rise apartment complexes, many with beautiful sea views.
3. Mui Wo is a rural town on the east of Lantau known for its tranquillity and bountiful surrounding nature. Properties vary from smaller apartments to larger houses, usually with terraces, rooftops, or gardens.
4. South Lantau is one of the up-and-coming areas for luxury property. Although it primarily features smaller village houses, there has been an increase in luxury housing and spacious villas by major developers in Hong Kong, allowing for resort-style living. Houses with such high privacy levels are rare finds in Hong Kong.

Lantau Property Information: Tung Chung, Discovery Bay, Mui Wo

Mass market Tung Chung, where the Tung Chung MTR line terminates, is already home to significant developments, such as Coastal Skyline, Caribbean Coast and Seaview Crescent. Across the market, property prices have been relatively stable for the last 12 months, averaging between $12,000 and $14,490 per square foot in May.

Over on the west side, Discovery Bay has seen a small price increase. Prices are up 2.3% to an average of $12,288 per square foot and have been holding steady for most of the past year, coming down almost 9% in May in the wake of rising interest rates and continuing inflation.

Mui Wo has experienced a similar trend in slight price increments, where the area has gained traction for its down-to-earth, more traditional village vibe and lifestyle. Its relative affordability also makes it a more popular option for residents, especially those seeking reprieve from the more urban areas of Hong Kong.

South Lantau Property Information

The final submarket, South Lantau, is also enjoying attention from both residents and developers, as a lifestyle destination in its own right. For years, the southern part of the outlying island was viewed as one of Hong Kong’s “hidden gems,” an opulent district known for its spacious villas and beach frontages, equally attractive to local and foreign investors and end users. However, its hidden gem status changed when Sino Land’s 16-house luxury development Botanica Bay launched in 2015. The four-bedroom homes ranging from 3,725 to 5,573 square feet made headlines for demanding South Lantau’s first $100 million transaction. That was followed quickly by Swire Propertie's Whitesands in 2017, its first South Lantau property development. The 28 detached houses belonging to this project range from 1,954 to 2,598 square feet, excluding gardens and rooftops.

Lantau Island: Lifestyle and Convenience

For residents, the ideal mix of natural environment, seclusion and tranquility, generous living space at good value and vibrant community, all while still offering the conveniences and easy access of the city has made Lantau a very attractive lifestyle option.

The commute to South Lantau is an easy one, with bus or taxi connections from Tung Chung MTR or Mui Wo ferry pier fast and reliable. Business travellers are in close proximity to Hong Kong International Airport, and families can opt for one of several schools on the island, including Discovery College, DBIS, and Lantau International School.

For leisure, Lantau is where all of Hong Kong goes to relax, and the island boasts some of the city’s best hiking trails (the Lantau Trail and part of the new, unofficial Tinworth Trail go through South Lantau), water sports (paragliding, kite surfing, paddling) and most beautiful beaches at Cheung Sha, Tong Fuk, Pui O and Silvermine. Water buffaloes and pink dolphins mingle effortlessly with the heritage of Tai O and its stilt houses, and the Big Buddha.

Lantau Luxury Property : Price Overview

Overall, residential transactions dropped 31.5% in April after a strong Q1, though developers have no doubt taken note of the resilience of the luxury sector. Volumes there rebounded in Q1/2023 following the elimination of travel restrictions, with transactions in the $50 to $100 million bracket up 85%, and volumes in the range up to $200 million climbing 240%.

With fewer than 30 luxury properties on the verge of launching in South Lantau, such as the still under construction Artisan, and only three completed land auctions as of May, luxury supply will remain tight while demand rises thanks to fresh investment -immigration policy designed to attract talent and new tax incentives attractive to investors.

Sino unveiled its second luxury property in South Lantau in 2021, Mt. La Vie. The six houses on Hoi Sha Path range in size from 3,773 to 8,059 square feet, with five sold for $81.7 million up to $182.6 million by May 2022. Only the 5,994 square foot Villa 3 remains for sale. Whitesands and Botanica Bay have set the bar in South Lantau luxury, currently averaging sales prices of $19,290 and $26,245 per square foot.

General property prices in South Lantau currently hover in the $6,000 per square foot range according to the Lands Department, but potential buyers don’t have to go to Whitesands rates to find great value. Village house rentals – the standard 2,100 square feet – and the re-envisioned town homes of Michelia at Cheung Sha lease for approximately $40,000. For slightly more extravagance, Swire returned to South Lantau with Ham Tin Villas in Pui O, leasing eight detached, three-bedroom homes (1,554, and 1,706 square feet, plus massive gardens), starting at approximately $75,000.

Lantau Property Outlook

Mass market transaction volumes and prices are expected to experience some volatility in 2023, but the forecast for the luxury property market remains positive.

With little to no new supply on the horizon and 12,000 approved professional arrivals poised to enter Hong Kong, Lantau Island is set to take a place alongside the outperforming Southside on the luxury landscape.

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Seeking Lantau Property Advice?

Our Habitat Property team is always happy to discuss the state of the Lantau (and Hong Kong) property market in further detail, offering advice an additional information/analysis. Please WhatsApp or email us at info@habitat-property.com for all your property needs and queries.

If you are interested in buying/investing or renting Lantau property, we have a number of properties for sale and for rent.

For other luxury properties in the area, browse our upmarket homes in Discovery Bay also for sale and for rent.