About: Mongolia, Property, Ulaanbaatar
Written by Philippe Massonnet on Monday, November 27, 2006
Mention the Asian property boom and most people automatically think of Hong Kong or Shanghai – but not Ulan Bator, where gold fever and uncomfortable traditional housing are sending house prices through the roof.
Billboards advertising luxury housing developments with names such as Marshall Town, Regency Residence and Japan Town are appearing all over the Mongolian capital.
They can be seen around Sukhbaatar Square, the historic center of the city.
Growing numbers of cranes rise up from the mountainous landscape that surrounds the city, which is enjoying strong economic growth thanks to resources such as copper and gold.
There may not be any skyscrapers there yet, but the buildings are getting taller. The national opera will soon be overshadowed by a tower being built next to it. The symbol of the property boom, it will house a five-star hotel, part of the Shangri-La chain. Hilton and Hyatt are also planning to set up in Ulan Bator.
“The property market is undergoing a revolution, with too much demand and too few apartments,” said Christophe de Gruben, director of real-estate company Mongolian Properties.
“One of the main reasons for this upheaval is mining speculation, big foreign companies bringing a growing number of expatriates who want modern accommodation.”
As a result, apartments with a monthly rent of more than US$1,000 (HK$7,800) have begun appearing in a country where the average monthly wage is about US$100. Average property prices are up 18 percent a year, according to Mongolian Properties.
The other factor is similar to the one that caused Hong Kong’s property market to boom 20 years ago, when thousands of residents abandoned boats for apartments.
Of the million inhabitants of Ulan Bator, some 60 percent still live in yurts, Mongolia’s traditional housing.
Many of them dream of more comfort, but most are too poor to fulfill that dream and there is a shortage of social housing.
As a result, the property revolution has caused much anger, with critics accusing the authorities of selling land to commercial developers rather than looking after the population.
“The politicians are violating human rights and children’s rights,” said SGanbaatar, a Mongolian economist and activist.
“Not long ago, under the socialist era, there were 700 playgrounds for children in the city, and now where are they? The mayor and the prime minister make money because children cannot fight,” added Ganbaatar, one of many campaigners who say corruption is blighting Mongolia’s nascent democracy.
The mayor, Trodt Batbayar, of the ex-communist MPRP party, did not deny that the city was undergoing an upheaval, but insisted he was working for the public good.
Link to the Hong Kong Standard Article
About: Mongolia, Property, Ulaanbaatar
