Cathay's Pay
Joined: Aug 2007
Posts: 31
Likes: 0
From: VMC on top
Approximately 3 shillings and six pence a day and still have enough change for a bag of chips on the way home.
Actually its quite rude to ask such a direct personal question. Answer is it's just enough to keep us off the streets.
Actually its quite rude to ask such a direct personal question. Answer is it's just enough to keep us off the streets.
Joined: Jun 2000
Posts: 476
Likes: 2
routetuner, you really do not have a clue do you? Why don't you grace us with you extensive knowledge of the CX "apartment buying scheme".
Perhaps the truth is not as appealing. Why don't you try for a job with the Murdoch press-I think you are more than qualified.
Perhaps the truth is not as appealing. Why don't you try for a job with the Murdoch press-I think you are more than qualified.
Joined: Aug 2007
Posts: 31
Likes: 0
From: VMC on top
Route Tuner,
Just relax old boy and stop being so aggressive. Just a turn of phrase and not meant as a literal statement of earnings. Your tone is just typical of what has become quite the norm around here. The abused have become the abusers I suspect.
Just relax old boy and stop being so aggressive. Just a turn of phrase and not meant as a literal statement of earnings. Your tone is just typical of what has become quite the norm around here. The abused have become the abusers I suspect.
Joined: Aug 2007
Posts: 163
Likes: 0
From: Hong Kong
CX Housing
The housing scheme is the only thing worthwhile about CX right now in terms of pay. The basic pay you get is crap in terms of your home currency (GBP, EUR, CHF, AUD, NZD, CAD etc). And with the demise of the USD, it won't be getting better any time soon. Also, inflation is on the rise here in Hong Kong. Food prices are up, house prices are up and transport prices are on the rise too.
So the 2 options are to rent or buy. If you rent, then you need to wait 2 years to get a decent enough allowance to get something even close to what is comfortable - especially with a family. Unfortunately it is dead money though.
If you buy, then there are a few considerations. First, you generally need to come up with 30% deposit. That's alot of money on a 9million dollar home. Sure, you might be able to sort out another option(personal loan, cooperative bank etc), but that's another story. Secondly, don't forget the stamp duty. That can be 250k or more on that 9 million dollar property. Thirdly, because the housing allowance is paid as a cash allowance, it is fully taxed at 15 or so %. This you need to account for as it will come out of your basic pay - not the allowance itself. Lastly, you are at the mercy of the property market. That entails a mixture of luck, balls and timing. There is potential to make a bundle of cash, But there is also the risk of being in negative equity too. So between the 30% deposit, paying tax on the housing allowance and paying the stamp duty out of your own pocket, the concept of CX paying a property off completely for you is a myth. Sure you can make capital gain, but the timing has to be right.
So the 2 options are to rent or buy. If you rent, then you need to wait 2 years to get a decent enough allowance to get something even close to what is comfortable - especially with a family. Unfortunately it is dead money though.
If you buy, then there are a few considerations. First, you generally need to come up with 30% deposit. That's alot of money on a 9million dollar home. Sure, you might be able to sort out another option(personal loan, cooperative bank etc), but that's another story. Secondly, don't forget the stamp duty. That can be 250k or more on that 9 million dollar property. Thirdly, because the housing allowance is paid as a cash allowance, it is fully taxed at 15 or so %. This you need to account for as it will come out of your basic pay - not the allowance itself. Lastly, you are at the mercy of the property market. That entails a mixture of luck, balls and timing. There is potential to make a bundle of cash, But there is also the risk of being in negative equity too. So between the 30% deposit, paying tax on the housing allowance and paying the stamp duty out of your own pocket, the concept of CX paying a property off completely for you is a myth. Sure you can make capital gain, but the timing has to be right.
Joined: Mar 2008
Posts: 4
Likes: 0
From: under the sea
Its YOUR name on the contract & mortgage with the bank, not Cathay's. So at the end of the day you're responsible for the debt. Negative equity=house worth less than the mortgage you owe the bank. All well & good to say CX is "paying" for it all, but they only do it for 15 years before you revert to the basic allowance of 24K p/m....would be a shame to be stuck in a flat paying it down b/c of negative equity whilst others have moved on to buying their second & third flats all b/c you timed the market wrongly
Joined: Oct 2000
Posts: 18
Likes: 0
From: eurotrip
Sounds easier to get ahead finacially in HK then in the US or OZ where airlines dont pay for your mortage, rent etc. I do understand that housing is beacuse of being an expat but having worked in Asia now back home in a westernised society, its bluddy expensive!! Interest rates for buying property has skyrocketted, at least if your careful and smart with your housing allowance you can do well out off HK and come back in a few years with either CX or someone else a wealthier hopefully wiser person
Joined: Nov 2001
Posts: 277
Likes: 0
From: NY
course you could work for Great lakes...i believe their Ops man says they can't use food stamps in uniform
http://airlinepilotcentral.com/airli...eat_lakes.html
http://airlinepilotcentral.com/airli...eat_lakes.html
Joined: Oct 2006
Posts: 651
Likes: 0
From: Hong Kong
The Messiah
You are correct - you do need to be intelligent about it. But how do you know when to buy and how much to pay?
Those that bought in 1996 and 1997 are still waiting to break even on their purchases. The best time to buy is when doom and gloom is greatest - after 1989 Tianenem square, or 2003 after SARS. Of course I only know that with hindsight - after the Asian Contagion looked like a good opportunity but prices continued to fall for another 3-5 years after that.
The best way to decide to buy or not is to do a 'what if' analysis and see if you can live with all the potential outcomes. Obviously if the property rises or stays at the same price you will make money over time. But unfortunately the HKG market has been more volatile than most and there have been multi year periods of falling prices.
A NC 'what if'
The assumptions.
Purchase price $9.6M
Stamp Duty/purchase costs $400K
Average Interest rate 5%
Housing Allowance $67K/month
Management fees/Gov rates+rent $60K pa
No repairs!
Tax 15%
Borrow 100% of property value and purchase costs (this allows for the opportunity cost of having your own money tied up in the property)
Monthly cash flow
Income $67K
Costs
Interest $41,667
mgmt/gov rates $5,000
Tax on Inc $10,050
Excess of income over costs
$10,283
So over 6 years you will have paid off close to a million. So from owing $10million on a $9.6million property you will now owe about $9million.
So as long as Hong Kong property doesn't go down by 7% you will make some money.
What ifwe have a repeat of 1997 - lets say prices fall 50% over 6 years ( I think the actual price fall was between 60-70%). You will be in negative equity of around $4million. Remember that in 1994 onwards it seemed like a sure bet buying HKG property as it had been rising for five years, since 1989. And here we are today with a sure thing in that prices have risen for five years since SARS.
No one I know can predict the future so not trying to predict a decline. But do your analysis based on all possible outcomes and make sure you are happy with all outcomes. If you buy for $10million then in 6 years a 10% decline in property will have cost you money overall!
Note. If you bought a $4.8m place using the same assumptions then after 6 years you would owe about half - so much safer bet. But good luck finding a place you want your spouse and kids to live in for around $5m!
Those that bought in 1996 and 1997 are still waiting to break even on their purchases. The best time to buy is when doom and gloom is greatest - after 1989 Tianenem square, or 2003 after SARS. Of course I only know that with hindsight - after the Asian Contagion looked like a good opportunity but prices continued to fall for another 3-5 years after that.
The best way to decide to buy or not is to do a 'what if' analysis and see if you can live with all the potential outcomes. Obviously if the property rises or stays at the same price you will make money over time. But unfortunately the HKG market has been more volatile than most and there have been multi year periods of falling prices.
A NC 'what if'
The assumptions.
Purchase price $9.6M
Stamp Duty/purchase costs $400K
Average Interest rate 5%
Housing Allowance $67K/month
Management fees/Gov rates+rent $60K pa
No repairs!
Tax 15%
Borrow 100% of property value and purchase costs (this allows for the opportunity cost of having your own money tied up in the property)
Monthly cash flow
Income $67K
Costs
Interest $41,667
mgmt/gov rates $5,000
Tax on Inc $10,050
Excess of income over costs
$10,283
So over 6 years you will have paid off close to a million. So from owing $10million on a $9.6million property you will now owe about $9million.
So as long as Hong Kong property doesn't go down by 7% you will make some money.
What ifwe have a repeat of 1997 - lets say prices fall 50% over 6 years ( I think the actual price fall was between 60-70%). You will be in negative equity of around $4million. Remember that in 1994 onwards it seemed like a sure bet buying HKG property as it had been rising for five years, since 1989. And here we are today with a sure thing in that prices have risen for five years since SARS.
No one I know can predict the future so not trying to predict a decline. But do your analysis based on all possible outcomes and make sure you are happy with all outcomes. If you buy for $10million then in 6 years a 10% decline in property will have cost you money overall!
Note. If you bought a $4.8m place using the same assumptions then after 6 years you would owe about half - so much safer bet. But good luck finding a place you want your spouse and kids to live in for around $5m!
Joined: Jan 2006
Posts: 601
Likes: 0
From: England
...and for Gods' sake take out the loss of licence and loss of income options of the benefit scheme. As noted above, YOU are the mortgage holder, and HSBC will still be banging on your door for their money whether you've lost your licence or not. A lot of guys made a lot of money to give to their first wives (and sometimes their second and third wives too), but some guys really !!!!! out too. As always, plan for the worst, and hope for the best!
....and don't EVER think it can't happen to you!
http://news.bbc.co.uk/1/hi/business/7354346.stm
....and don't EVER think it can't happen to you!
http://news.bbc.co.uk/1/hi/business/7354346.stm
Last edited by Kitsune; 19th April 2008 at 07:46.
Joined: Jun 2007
Posts: 33
Likes: 0
From: A Red State
I'm not flaming anyone here, but for a little perspective on things in the big picture, check out:
GlobalRichList
Select your currency and annual salary and see where you rank. See the big picture in 7 seconds . . .
GlobalRichList
Select your currency and annual salary and see where you rank. See the big picture in 7 seconds . . .
