Home sales in Hong Kong and mainland slow amid stock market uncertainty
The housing markets in Hong Kong and on the mainland have seen lower volume due to uncertainty caused by the rout in equity markets, say analysts.
Despite the recent recovery in stock prices, property seekers are more cautious compared to a few weeks back during the market boom.
In Hong Kong, 25 units in the primary market were sold over the weekend, 58.3 per cent lower than the previous weekend as most developers slowed their launches amid the stock slump.
In the secondary market, nine units were sold at the 10 largest estates tracked by Centaline Property Agency.
Eyes are now set on the upcoming release by Cheung Kong Property Holdings of Stars By The Harbour in Hung Hom. The project includes 321 units, with 312 flats measuring 706 to 1,408 sqft and nine villas in sizes of 2,196 to 2,235 sqft.
The developer planned to launch the first batch of 65 units this month, said BNP Paribas.
"Given the recent weakness in the stock markets, we expect more potential buyers to adopt a wait-and-see attitude and transaction volume is likely to remain low in the short term," it said.
A similar picture has emerged in mainland cities.
"The national data has not come out. But our business slowed in July," said Centaline group chairman Sherman Lai.
In Shenzhen, transactions in the secondary market clinched by the agency fell 30 per cent in the first two weeks of July from a month earlier, said Lai. In Beijing, the decline was 20 to 30 per cent.
Despite the recent recovery in stock prices, buyers showed caution due to the diminishing wealth effect, Lai said.
After the crash last week, the Shanghai Composite Index rose for three consecutive days before retreating 1.16 per cent yesterday.
"We saw a sudden increase in property defaults last week, but the timely stock rebound diminished the effect," said David Hong, the head of research at data provider China Real Estate Information Corp.