It is never reassuring when a chief executive admits to being scared. But Hong Kong's Donald Tsang is right: the cost of property in the city really is “quite frightening”.

From Mumbai to Melbourne, real estate prices are stalling as higher interest rates take hold. Not in Hong Kong, though, where the widely followed Centa-City leading index of residential prices is still rising, prompting a fourth round of corrective measures from the central bank earlier this month. For locals, there are clear incentives to load up: still-affordable mortgage rates, and a persistently weak currency. Over the past ten years the Hong Kong dollar has depreciated against everything bar the Mexican peso.

The more important driver, though, comes from over the border. For mainland Chinese, a 22 per cent gain for the renminbi since 2001 is reason enough to go long Hong Kong. Further, an apartment in the city is a hedge against instability – safely away from the long arm of Beijing, yet still close to home. Retail sales data show mainlanders’ ferocious purchasing power. Jewelry and watches accounted for 21 per cent of the total value of retail spending in March, for example – higher than all food, booze and supermarket bills combined.