[gkanapathy]

The article also claims that it's a free market. While Hong Kong has a very free-market economy in most things, real estate and development is the one thing where it is less free than most places. It is the part of economy where the government is most involved. The government controls all land, and sells/leases it to developers at a restrictive pace, under its own requirements. There is in fact a lot of land area in Hong Kong, but the government only makes it available to build on in a very limited way. That is really one reason prices are so high, the supply restrictions. The government is fine with that as it keeps prices high when it sells rights to develop land eventually.

This is also one of the least transparent, probably most corrupt, and definitely most expensive and inefficient parts of Hong Kong's economy.

There is probably some role for the government to preserve open space and plan and so on, but to suggest that the free market is at work at the macro level in Hong Kong real estate is ignorance.