Golfing is not the hobby of choice for those who are short of cash. Once you’ve factored in course fees and membership, a nice, shiny new set of clubs, and kitted yourself out with the right attire, the bills really begin to stack up. But over in Hong Kong, golf cart dealers are taking things a step further. In the Discovery Bay area of the city, carts are regularly changing hands for over HKD$2million ($331,162.58). This figure is more than double the price of a Porsche 718 Boxster, which retails in Hong Kong at HKD$972,000 ($153,497), and slightly less than double the price of a new Tesla Model 3, available in the region for HKD$1.03million ($171,000). To reinforce even further how expensive this is, a brand new golf cart in Australia or the United States will set you back between $5,000 and $15,000. So why are the most expensive golf carts found in Hong Kong?
So, why is this? Why are Discovery Bay’s golf carts so expensive to purchase? There are a multitude of factors which have led us to this unusual phenomenon
Hong Kong Is Not a Cheap City to Begin With
After spending decades as one of the financial hotspots of Asia, and even the world, Hong Kong has garnered a reputation for glitz, glamour, and high prices. Take a trip in mainland China – even in the pricier areas such as Shenzhen or Shanghai – and your dollars are likely to go far. Over the border in Hong Kong, this is not the case.
This is why the city has become known as one of Asia’s most expensive locations, which goes some way to explain why golf carts are so expensive here. But double the price of a brand new Porsche or Tesla? Somehow it feels that this is not the whole story.
Golf Carts Are a Flexible Choice in a Crowded City
Another clue lies in the layout and development of Discovery Bay itself. Narrow streets, two-lane byways and a whole lot of traffic, both of the pedestrian and the automotive variety, make this a difficult location to navigate, particularly during peak times.
This makes the humble golf cart a very attractive proposition indeed. Visit Discovery Bay and you are likely to see many of these vehicles on the road, perhaps supporting executives on their commute to and from the office, taking kids to school in the morning and home again in the evening, or providing transport for a trip to the local shops.
In fact, in the residential heart of Discovery Bay, administrators have banned standard vehicles altogether in the hope of preserving the ‘resort feel’ of the area. This immediately increased demand for golf carts, as affluent residents searched for an alternative means of transportation around their neighbourhood. These already expensive machines suddenly experienced a further increase in price.
But purchasing a golf cart does not mean sidestepping the red tape and hassle that is more commonly associated with buying a car. If the vehicle is going to be used outside of a golf course or resort, the owner and all drivers must hold Hong Kong driving licences or international driving permits, which are valid in the territory of Hong Kong. This stops just anyone from getting behind the wheel of a golf cart (although the price tag also performs a similar function) and terrorising the streets of Discovery Bay.
Licences for golf carts have also been capped at 500 in the area, further inflaming local interest.
Hong Kong Residents View Golf Carts as an Investment
The fiscal climate of Hong Kong is not a friendly one for those with savings or for those looking to make small scale investments. Interest rates are next to nothing in Hong Kong, which means residents need to have serious money in the bank if they are to see this stake grow over time. For most of Hong Kong’s citizens, patience is wearing thin.
It is these woeful interest rates which have forced residents to get creative with their investments. This is why peculiar asset acquisitions are a common sight in Hong Kong. Ultra expensive golf carts are just the latest in this long line.
Bill Chan is a director at Century 21 Newcourt Realty; a real estate agency in the Discovery Bay area. He is not surprised that locals and expats are willing to pay astronomical fees for these vehicles.
Most Expensive Golf Cart – HKD$2,000,000+
“[If] you have HKD$2million, [it’s] better to buy a golf buggy rather than put it in the bank,” he said, echoing the sentiments people in the area who are disillusioned with how local financial institutions are handling their deposits.
These durable machines represent a valuable asset, which could increase even further in value. The cost of a golf cart has skyrocketed from only a few thousand Hong Kong Dollars in the 1980s, to the astronomical fees we are seeing today. What’s more, renting out golf carts to other users can net the owner between HKD$8,000 ($1,329.58) and HKD$10,000 ($1661.97) each and every month. With renting, the golf carts will pay for themselves over time.
Real Estate Prices Are Through the Roof
But with that much capital to freely spend, would residents of Discovery Bay not be better served investing in property? Well, the answer is certainly ‘yes’, but unfortunately, this is beyond the grasp of most locals.
This is because property prices are through the roof in Hong Kong, and particularly in Discovery Bay. A golf cart may be worth two new Porsches, or the best part of two Tesla Model 3s, but that HKD$2million is not going to get you very far in a district where properties start at HKD$8million and regularly trade hands for as much as HKD$80million.
When mind-boggling numbers like this are inserted into the equation, it becomes easier to see why Discovery Bay residents would rather purchase a versatile and potentially lucrative investment like the most expensive golf cart rather than a tiny piece of real estate in a prohibitively expensive city.
It is this perfect storm of financial influencers and social trends which has led to Discovery Bay golf carts becoming the most sought after – and the most expensive – buggies on the planet. This corner of Hong Kong may be the global epicentre of the golf cart industry, but if you want to pick up one of these machines for yourself, you are probably better off doing so right here in Australia.
This entry was posted in Golf Carts