Hong Kong reports another dismal sales weekend in Tuen Mun as home market heads for the big chill

Hong Kong’s residential property market witnessed another weekend of dismal sales, as even double-digit discounts could not lure buyers to commit, in yet another sign that the world’s priciest flats have given way to a buyers’ market.

Chuang’s China Investments, which offered discounts of up to 16 per cent for 150 flats of The Esplanade project in Tuen Mun, managed to sell three units at 5:30pm, five hours after the launch kicked off, agents said.

“The market has turned soft,” said Midland Realty’s residential division chief executive Sammy Po Siu-ming, adding that seven units, at most, would be sold by the end of the day. “No one is getting up early to queue, as they know that even if they were to come in at 7:00pm, there would still be enough flats for them to choose from.”

What a difference six months make. Developers were able to sell at least 90 per cent of their property on every sales launch during the first six months of this year.

As many as 20 buyers were bidding to buy every available flat in Hong Kong as recently as May, before the government proposed a vacancy tax in July to force developers to put more apartments on the market. That was also before Hong Kong’s commercial banks finally bowed to rising interest rates and raised their mortgage payments for the first time in a decade.

The combination has had a chilling effect on the city’s housing market, where median prices that rose for 28 consecutive months through August finally reached a plateau.

Prices had fallen by 4 per cent in the past eight weeks, and valuers are expecting a decline of as much as 15 per cent in the next 12 to 18 months, according to Moody’s Investors Service. Developers’ sales weekends have gone from bustling shows to humdrum events, turning in recent weeks into deserted affairs.