I was there 2 years ago in July and it wasn't too bad. If you don't mind hot and humid weather then you'll be fine. Hong Kong is one of my favorite cities to visit and as others have said, you can splurge on hotels as you can in any other world class city but you can also find places that are definitely reasonable. The Kowloon side tends to be a bit cheaper than staying on the Hong Kong side. There is lots to do on either side and transportation between the two is easy with the subway or ferry. Also, Lantau Island is a nice day trip. The food, shopping and culture are great there - you definitely feel like you're in an Asian city but it is still quite modern. Quite difficult to describe it unless you've been there.
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