The hottest story in Hong Kong right now – after the discussion about the unseasonal smog on the city this month – is about its property prices.

Yesterday, the real estate market broke all records with the most expensive sale ever, a three-storey house on the Peak (the hill with cable car that overlooks the city and harbour) for HK$280m. That’s about US$40m, or HK$60,215 (US$8,500) per square foot. Hong Kong talks about real estate in square feet because it sounds sooooo much better than in meters, doesn’t it?

“And the square feet includes the communal corridor and sometimes the lift,” swore an HK expat the other night. Well, my apartment’s measurements include the balcony, I said, but when a HK resident raised her brows at the very idea of a balcony, I knew we were talking different planets.

The cost of a home here is now the second highest in the world after New York, beating Tokyo, Mumbai and Singapore. Frighteningly, real estate prices went up in the tiny district nearly 21% last year, and suck up, on average, 37% of a family’s income.

Remind me to stop moaning about Melbourne’s real estate spike…