Under pressure from the government, the local luxury property market has seen a fall in transactions during the past two months.
In October, the Hong Kong Monetary Authority (HKMA) reduced the required loan-to-valuation ratios for luxury properties of more than HK$20 million, from 70 per cent to 60 per cent.
With the HKMA attempting to restrict soaring luxury property prices, potential buyers cannot see the value of properties rising in the near future and are hesitant because they don't like to see little or no profit from their investments, says Dennis Lam, Stately Home regional associate director of The Peak and South at Centaline Property Agency.
The number of transactions of luxury properties in the Tai Tam area fell from six cases in September to one in October and five last month.
There have been no transactions so far this month, according to the agency. The slowdown in transactions has also put a temporary halt to the rise in luxury property prices. 'The prices of waterfront houses in Redhill Peninsula [Tai Tam area] hit a record high [about HK$60 million] in September and have been steady ever since,' Lam says. 'We believe they will remain steady for the next couple of months as well.'
A 3,054 sqft Type I house is on sale at Redhill Peninsula, with an asking price of HK$53 million, rounding up to HK$17,354 per sqft. There are two types of houses on the housing estate. One is waterfront and the other has a sea view, but is located on a slope behind the waterfront houses. Type I is of the latter group.
