By Natalie Wong

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With Hong Kong leader John Lee set to deliver his annual policy address on September 17, the Post examines key topics the chief executive is expected to focus on, including a mega infrastructure project near the border, new economic drivers and livelihood issues.
In the fifth of a seven-part series, Natalie Wong looks at the effect of the city’s top talent scheme on the rental property and job markets.
In Kai Tak, Hong Kong’s up-and-coming hip hotspot and home to a new 50,000-seat stadium, the tenant mix along a major promenade where residents shop for daily essentials reveals a lot.
Among roughly 40 shops lining the 800-metre pavement, 13 are property agencies – far outnumbering restaurants, pharmacies and convenience stores.
Some property listings feature simplified Chinese characters, catering to a growing number of mainland clientele. One advert promotes a 559 sq ft two-bedroom flat at the Cullinan Sky private development, next to Kai Tak MTR station, for HK$12.8 million (US$1.6 million).
“Nearly 80 per cent of our buyers here are from mainland China, including those admitted under government talent schemes,” veteran property agent Jeffrey Wai Man-chun said.
“Our sector – and actually our economy – has depended on them to stay afloat these few years, especially with weak demand locally.”
Nearly three years into the launch of the Top Talent Pass Scheme, more than 220,000 successful applicants have arrived with their dependants, reshaping Hong Kong’s social and economic landscape.
While the scheme is intended to offset a population decline and stimulate economic growth, it has driven up rents as well as intensified competition for jobs and educational resources, sparking anxiety among locals.
The rental scene is a rough proxy for how Hong Kong has changed with the arrival of new talent – mostly from the mainland – in ways big and small.
Observers have called for more to be done to manage ties on the ground and help new migrants blend in and acclimatise to their new environment to pre-empt any nascent tensions.
Location, location, location
Wai, Midland Realty’s chief district sales director for Kowloon East, described changes in the property market in the past three years as unprecedented, largely driven by an influx of mainland talent.
“Property prices have dropped by about 30 per cent compared with the peak during the Covid-19 pandemic, but rents keep soaring with no signs of easing,” said Wai, who has spent three decades in the industry.
Official data shows that 70 per cent of newly arrived talent opt to rent in Hong Kong.
He said the strong demand had pushed the city’s private residential rental index to a six-year high in July, with a cumulative increase of 1.61 per cent in the first half of the year.
Neighbourhoods popular with mainlanders, including Kai Tak, Wong Chuk Hang and Tseung Kwan O, had experienced the steepest rent increases, mainly because of their new properties, MTR connectivity and good public school networks, he said.

In Kai Tak, a studio flat that cost HK$10,000 a month to rent three years ago now commanded HK$13,000, with better-furnished ones fetching up to HK$16,000, Wai said.
“Since the first quarter of last year, transactions have hit the best levels in decades,” he said. “But it’s also true that the high rents in newer neighbourhoods are gradually pushing locals to more remote and older areas.”
To better serve new clients, Wai said his company had hired more gang piao – or “Hong Kong drifters” – a term coined to refer to mainlanders who now live and work in the city.
In his district, up to 40 per cent of the staff are mainlanders who put social media platforms such as RedNote to good use to showcase flats in their portfolios.
Property agent Tom Chen, who moved to the city from the mainland 10 years ago, is also benefiting from the talent scheme.
His RedNote account, which promotes different flats for sale or rent, has drawn more than half a million followers on various social media platforms.
He said more landlords now preferred tenants capable of paying half-year or even full-year rents in advance, most of whom were top talent visa holders.
“Mainland talent who settle in the city are mostly well-off,” he said, noting that locals who might not be able to promise an advance payment might become less popular with landlords.
Across the harbour in Central, famed nightlife district Lan Kwai Fong has also been transformed with the influx of gang piao.
Lan Kwai Fong’s biggest landlord, Allan Zeman, said the area, a popular haunt of expatriates, became a ghost town during the Covid-19 pandemic but the talent scheme had revived it and “changed everything dramatically”.
In just two years, his landmark California Tower, which used to have “a lot of empty floors”, was now nearly fully occupied.
Its tenants include a mainland karaoke chain and a high-end Sichuan restaurant, which boasts a Michelin-awarded brand across the border, that opted to rent one more floor a few months after it opened this year.
Two storeys above the eatery, another new restaurant offers authentic Yunnan cuisine.
Similar changes are visible across the city. Mainland chains such as Tai Er Suancai and Fish and Shenzhen-headquartered Hunan cuisine restaurant Nonggengji have gone against the trend of eatery closures over the past year. All have expanded rapidly, with each having nearly 10 branches since their debut in 2023.

Zeman said local operators were not willing to open restaurants during the difficult times, so he made the bold move when he saw that the customer base had changed.
“There are a lot of mainlanders here now, so why not give them what they want?” said Zeman, who also sits on the government’s Human Resources Planning Commission.
Zeman stressed that Lan Kwai Fong remained very international in that it was still the go-to place for foreign visitors, even as the changes brought by the mainlanders were helping the area reap “very good numbers”.
Compared with foreigners who spent the night “drinking two beers”, mainlanders would buy Moutai, China’s premier liquor brand, or as much as HK$200,000 on “the best champagne”, he said.
Money talks
The Top Talent Pass Scheme, introduced in December 2022, targets high-income earners and graduates from top global universities. Applicants do not need to have a job offer in hand, and the visa is usually granted within weeks.
Among the successful applicants, 95 per cent were from the mainland, with one in three aged between 18 and 30.
In the past three years, 35,746 individuals in that age group were approved to come to Hong Kong. In contrast, Hong Kong’s eight publicly funded universities had 21,058 graduates in 2023-24.
Local graduate Nicole Chung, 23, is among those who feel there is greater competition for entry-level jobs. She earned a degree in social entrepreneurship and development studies, a new programme offered by the Education University of Hong Kong, last year.
She secured an administrative job at an educational institution for HK$17,000 per month. But within three months, she heard the company was struggling and she was getting axed.
“I felt frustrated when I learned that some mainland colleagues doing similar jobs as me were being paid as low as HK$10,000,” she said. “Letting me go could help the company save more.”
After sending out more than 60 résumés over the past year with no success, Chung has lowered her expectations.
“I know I can’t afford to be picky any more, particularly with this slow economy. Now I just want to land any office job,” she said.
Some employers the Post talked to admitted they were increasingly turning to mainland candidates who were typically less jumpy and willing to accept lower wages.
I know I can’t afford to be picky any more, particularly with this slow economy. Now I just want to land any office job
Nicole Chung. local graduate
A construction company manager said local graduate engineers were offered starting salaries between HK$25,000 and HK$30,000, while their mainland counterparts often accepted HK$15,000 to HK$18,000 for similar roles.
“For some mainlanders, they think this salary is not bad. In a second- or third-tier mainland city, a graduate engineer earns 6,000 yuan per month,” said the manager, who asked to remain anonymous.
But he expressed concern that in the long run, starting salaries for local graduates would be dampened. The average monthly salary for local university graduates in 2023-24 was HK$27,400.
A fresh civil engineering graduate from the University of Hong Kong (HKU) said he secured a job as a graduate engineer with a monthly salary of HK$26,000 with a local contractor. He said his three to four mainland colleagues were paid less as assistant engineers.
“They are very hardworking and often work overtime without complaining. They are fast learners too,” he said. “It’s healthy competition.”

Felix Yip Wai-kwong, associate director of the Centre for Human Resources Strategy and Development at Baptist University, warned that the talent policy could intensify competition in the local job market.
Hong Kong’s unemployment rate rose to 3.7 per cent over the past three months, marking its highest level since October 2022.
While officials attributed part of the rise to new university graduates entering the workforce, the arrival of the newcomers under the talent scheme might have also added pressure to an already competitive job market, particularly in sectors popular among locals, observers said.
Yip said among the three sectors hiring the most non-local talent, two – commerce and trade, and financial services – were Hong Kong’s traditional strongholds with significant competition among locals amid employers’ cautious outlook.
With limited job vacancies, he said, both local and mainland talent might find it more difficult to secure jobs and might also need to lower their salary expectations.
“Demand creates supply, not supply creates demand,” Yip said, calling on the government to fine-tune its policy to draw the talent that it really needed.
“The government’s focus should shift to luring and retaining talent in innovation and technology, a field that the city has yearned to develop for a long time but lacks relevant professionals.”
Follow economic cycles?
Observers suggested Hong Kong should tighten its talent admission threshold to mitigate the impact on residents while also better aligning with the city’s developmental needs.
Lawmaker Frankie Ngan Man-yu, a spokesman for a talent working group in the city’s largest political party, the Democratic Alliance for the Betterment and Progress of Hong Kong, called on authorities to consider tightening the “Category C” quotas of the scheme to reduce competition with local graduates.
Category C covers applicants who are degree holders from a list of recognised universities without three years of work experience.
At present, the annual quota for such applicants is set at 10,000, while the government recently revealed that only 40 per cent of visa holders had applied for an extension, the lowest rate across three categories.
Currently, talent visa holders can also renew their permits without living in Hong Kong as long as they provide proof that they have been posted to the mainland or overseas.
“The ambiguity could open the door to abuse. A clear residency requirement could actually encourage talent to formulate a clearer plan for their stay in Hong Kong,” said Taco Wong, a co-founder of the immigration consulting agency Everglory Global Advisory.
Australia requires skilled migrants to live and work in designated regions. In Germany, the EU Blue Card requires applicants not to be absent from the country for more than six consecutive months.
Experts said Hong Kong’s talent scheme could also benefit from a point-based system to target the types of talent the city really needed.
Canada’s express entry system ranks applicants based on age, education, work experience and language proficiency. Britain’s points-based system evaluates talent based on skills, including language, and salaries.
Donald Low, a public policy professor at the University of Science and Technology and a former civil servant in Singapore, said Hong Kong’s talent policies should be attuned to economic cycles.
“Labour or immigration policy has to be countercyclical,” Low said. “You loosen it when you have a need for more labour, you tighten it when the economy is not doing well.”
Low, who served nearly 15 years in Singapore’s Administrative Service and held senior roles at the Ministry of Finance and the Public Service Division, pointed to the city state’s multi-tiered talent strategy, saying that during a period of slow growth in the Covid pandemic, “foreign workers were the first to be let go” to protect the jobs of locals.
In 2023, as demand surged, Singapore introduced the ONE Pass visa, allowing top-tier professionals to work independently of employers – a move Low described as timely and targeted.
In contrast, he argued, Hong Kong had misjudged the strength of its rebound.
“Job creation was quite sluggish. But when you are still bringing in this large number of supposed top talent, that’s just going to create a great deal of wage deflation pressures,” he said. “It’s just going to add to the unemployment problem.”
He urged policymakers to recalibrate the talent scheme by aligning it more closely with actual market needs.
“Hong Kong has to ask the question: which sectors are actually short of high-skilled labour that are creating jobs that Hongkongers cannot do?”
Additional reporting by Leopold Chen, Jeffie Lam and Willa Wu