Home sales fell last month to their lowest level since late 2008, at the start of the global financial crisis, indicating government measures have succeeded in curbing demand.
The number of residential transactions plunged 53.3 per cent to 3,286 from November, while the total value tumbled 59.1 per cent to HK$17.2 billon, data released by the Land Registry yesterday showed.
"It is the lowest since November 2008 in terms of sales volume," said Midland Realty senior research manager Anita Cheung. That month, she said, the number of residential transactions was 3,264.
"The drop in home sales is mainly due to the new cooling measures," said Ringo Lam Chun-chiu, the director of valuation at AG Wilkinson & Associates. "Sales volumes are unlikely to pick up in a short time as the market is still clouded by the policy risk, but I believe we have seen the worst."
Total property transactions, including homes, offices and parking spaces, numbered 9,129 last month, 21.2 per cent fewer than in November.
The figures came two months after the government introduced on October 27 a 15 per cent buyers' stamp duty for corporate buyers and non-permanent residents to cool the market.
Lam said sales volumes might improve after the Lunar New Year.
In contrast to the volume of transactions, home prices started to rebound early last month. The Centa-City Leading Index, which tracks prices at 100 housing estates in the city, closed at 115.18 for the week to December 23, up from 114.38 for the week to December 2.
Patrick Chow Moon-kit, the head of research at Ricacorp Properties, said home sales in major estates had picked up in recent weeks. "Various developers are gearing up to launch new projects, which will boost sentiment," he said. "In view of excess liquidity, it is unlikely we will see a significant fall in home prices."
As prices have shown no sign of declining, Chow was worried the government might introduce further cooling measures. "There is a 50-50 chance the government will introduce further measures when Chief Executive Leung Chun-ying delivers his first policy speech in the middle of this month," he said.
He said a capital gains tax, for instance, would force a sharp price correction. "But it would kill the industry, as no one would be interested in buying or selling at all," he said.
Lam, however, said he did not expect the government to take further measures in regard to private housing.
"A sharp correction in the housing market may hit the economy," he said. "I expect the chief executive to expand the coverage of the government-subsidised housing scheme."