It has long been the dream of many in Hong Kong to win the city’s ‘Mark Six’ lottery. At least then, goes the thinking, they might be able to get a mortgage to buy a home.

Such has been the rate of house price inflation, however, that even winning the Mark Six jackpot might not be much help.

Last week, nano units of no more than 221 square feet went on the market at Artisan House, a redeveloped building in the historic Shek Tong Tsui district of Hong Kong Island. The developer, New World Development, had set its price per unit in eight figures (in Hong Kong dollars), although a 20% ‘discount’ was applied. In other words, buyers are being asked to pay a whopping HK$45,403 (US$5,836) per square foot. Units are priced at HK$8.03 million (US$1.03 million).

New World is not the only developer to blame. Sun Hung Kai Properties, the biggest developer in the city, is launching a new batch of small units at Cullinan West, in Shum Shui Po, one of the city’s lowest-income districts. They will sell for HK$5.68 million, or about HK$20,000 per square foot, up 10% since the launch of an earlier batch six months ago.

Welcome to Hong Kong, where it seems that the smaller the unit the higher the price per square foot, and where many people inhabit shoebox-sized homes worth more than US$1 million.

Twenty years after the city’s ‘handover’ to China following the end of British colonial rule, Hong Kong property prices are at a historic high. This year, two land tenders have broken a 20-year record. Last week, a waterfront site in Cheung Sha Wan, a former industrial site, was sold to Sino Land for HK$17.8 billion.

In order to get around paying the duty, some are buying in their children’s names

Over the past two years, the panic buying virus appears to have infected both developers and consumers. Mainland Chinese developers have been drawn to Hong Kong to make a profit and to shift assets out of China, particularly as the renminbi fell last year. The currency has stabilized but the trend has continued. HNA Group paid HK$20 billion – a price that was more than 50% above the then market price – to buy three parcels of land at Hong Kong’s former Kai Tak airport.

On the consumer side, buyers are lining up to secure flats, despite tightening of a special stamp duty on second property purchases. In order to get around paying the duty, some are buying in their children’s names.

Knowing the demand, some developers have asked potential buyers to make a cheque deposit before they are allowed to view flats. Sun Hung Kai properties has been asking for deposits of HK$7 million before showing flats at a long-anticipated seaside project in North Point.

Perhaps the Hong Kong Jockey Club will get round to raising its jackpot. Right now, winning the ‘Mark Six’ might only be enough to get you a viewing of flat – you’ll need a lot more in the bank to buy one.