New-home completions down - but starts are up
The number of homes completed in the city in the first seven months has plunged 43 per cent from a year earlier, Ricacorp Properties says. But housing construction starts were up.
A rise in construction starts should mean more flats coming onto the market in two to three years' time.
The Buildings Department reported that in July three private housing developments, comprising 195 units, were completed, bringing the number of homes completed to 4,692 over the seven months. In the same seven-month period in 2010, there were 8,610 homes completed.
Patrick Chow Moon-kit, research head of Ricacorp Properties, said the 4,692 homes amounted to 44 per cent of the government's projection for completions this year of 10,675.
He expects between 9,000 and 10,000 flats to be completed this year - less than the original forecast.
The three projects completed last month included The Altitude in Happy Valley, built by Kerry Properties and comprising 126 flats, and projects in Hung Hom and Sai Kung.
Given that the supply of homes is tight, Chow said he does not expect prices to fall sharply, even though buying sentiment has been weakening and banks have been raising mortgage interest rates.
Looking ahead, however, the number of homes under construction is on the rise.
The number on which construction started in the first seven months of the year increased to 3,039, up 28 per cent over the same period last year.
Ricacorp's Chow said as the government came under pressure to release more land for residential development, the market would see more new supply through government land auctions and tenders of sites along rail lines by the MTR Corporation. He expects private-housing construction starts to increase to between 8,500 and 9,500 by the end of the year, 76 per cent more than last year, when work started on 5,397 homes.