A residential housing complex is seen in Hong Kong on Dec 18, 2018. (ANTHONY WALLACE / AFP)
HONG KONG - The number of Hong Kong’s residential property transactions decreased in August after booming since the beginning of this year, and will continue to decelerate in September, the global real estate service provider Cushman & Wakefield said on Wednesday.
The transaction volume fell in line with a reduction in the number of available affordable units, the firm said as it estimates that the total number of sales and purchase agreements in the first nine months of 2021 will be 77,369, up 27 percent year-on-year, while the residential S&Ps at an estimated 57,956. Both eclipsed the previous highs from 2012.
However, the number of residential S&Ps for the third quarter in 2021 is forecast to drop 19 percent compared with the previous quarter.
Edgar Lai, Cushman & Wakefield’s director of valuation and advisory for Hong Kong, said that the average house price has risen by 4.3 percent since 2021, and is expected to surpass the peak of May 2019 soon
“This is mainly due to the fact that affordable units have been gradually consumed by the market,” said Keith Chan, Cushman & Wakefield’s head of research for Hong Kong.
“With limited availability of residential units, owners’ bargaining space has narrowed, and they even began to raise prices. Buyers took a wait-and-see attitude, waiting for the market to cool down, leading (to) a see-saw situation between the two,” Chan said.
Edgar Lai, Cushman & Wakefield’s director of valuation and advisory for Hong Kong, said that the average house price has risen by 4.3 percent since 2021, and is expected to surpass the peak of May 2019 soon.
Lai said he expect both transaction volume and property price increments to continue to slow down in the fourth quarter. “Following a round of active transactions, we expect that the purchasing power previously accumulated in the property market has been released. Buyers also become more cautious after prices have recorded certain increments so far,” Lai added.
“Moreover, banks are less active in getting business at year-end as it is traditionally an off-season period for mortgages.”
Cushman & Wakefield forecasts 8 percent to 10 percent growth in residential prices throughout 2021 since the start of the year.
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