Hong Kong’s largest developer contradicts doomsayers, says home prices to remain stable
In contrast to analysts’ forecasts, the city’s largest developer in terms of market capitalisation said it expects Hong Kong ‘s home prices to remain stable next year.
“Even if interest rates rise next year, there won’t be a big increase,” said Victor Lui Ting, deputy managing director of Sun Hung Kai Properties.
Speaking after the company’s annual general meeting on Thursday, Lui said the market saw a mild correction in the fourth quarter after an increase in the first nine quarters.
READ MORE: Hong Kong property sales slump to 19-month low for October - and worse is yet to come, say analysts
Due to the growth in the first three quarter, Lui predicts that prices for the whole year will be higher than that of the previous year.
Lui ‘s upbeat view contrasts an increasing number of analysts who forecast that home prices are heading for a correction next year as more units come on the market, interest rates rise, and the Hong
Kong economy faces a possible weakening.
Investment bank Jefferies has said home price will fall 30 per cent, taking them back to the 2012 levels.
David Ji, head of research and consultancy, Greater China, at Knight Frank, expects residential prices to drop 5-10 per cent next year.
Prices of used homes at 50 housing estates monitored by property agent Ricacorp last month fell 1.2 per cent per cent to an average of HK$11,964 per square foot, following a 0.1 per cent fall in September.
The decline is expected to continue, according to Ricacorp Properties.
Lui also said the company has obtained presale consent for its Park Vista in Yuen Long. The launch will be scheduled for this month.
Yuen Long is seen as the battle ground for developers, with more than 4,000 units to come on the market in the next couple of months.
The Hong Kong government has reaffirmed its intention to release more land to increase new homes. The Transport and Housing Bureau has said that around 86,000 new private homes are projected to enter the market over the next 3-4 years.
