Gap on price keeps home sales sluggish

Home sales in the secondary residential market remain sluggish because of a big gap in price expectations between buyers and sellers that has made negotiations more time consuming, Ricacorp Properties says.

Data on sale and purchase agreements compiled by the real estate agency from transactions in the city's 50 biggest private housing estates show 182 deals were completed in the week July 25-31, versus 179 deals in the previous week.

It was the third successive week in which deal numbers were below 200.

'While some potential buyers are looking for bargains, sellers remain optimistic about the market outlook and refuse to offer discounts. So closing deals is more difficult in the present circumstances,' Ricacorp director David Chan said.

Deal numbers were up on Hong Kong Island, however, where 29 homes changed hands last week, up from 19 a week earlier.

Four flats were sold in Kornhill in Quarry Bay compared with just one in the previous week. But underlining the argument that buyers had to be lured into the market by lower prices in the present climate, the Kornhill deals were done at an average price of HK$7,336 per sq ft, down 12.3 per cent from HK$8,364 a week earlier.

By contrast, however, average transaction prices in Taikoo Shing rose 10.7 per cent to HK$9,789 per sq ft last week, and prices in City Garden were up 23.3 per cent.