Mainland Chinese buyers’ interest in Hong Kong luxury homes wanes as trade war sours appetite
- Business owners from the Pearl River Delta, the major buyers of luxury property in Hong Kong, have been affected by the trade war
- Market observers say the temporary trade war truce will not have much of an impact on the city’s property market
Fewer deep-pocketed mainland Chinese buyers are showing an interest in Hong Kong’s luxury homes amid rising economic uncertainty brought by the US-China trade war, with market observers saying enquiries for property over HK$100 million (US$12.8 million) has fallen by half.
“Most of the buyers from the mainland are business owners whose businesses might be directly affected by the tariffs, while some are just holding off on their offers because of the uncertainties,” said Patrick Chau, senior director of residential development at Savills.
Businesses in the Pearl River Delta, one of the major manufacturing regions, have suffered because of the recent trade war. Punitive tariffs of 10 per cent slapped on US$200 billion of Chinese goods has made them uncompetitive.
Transactions in the luxury segment have been rather quiet, about 20 per cent fewer after the onset of the trade war
According to Goldman Sachs, China’s gross domestic product growth could slow to 6.2 per cent next year. Beijing has set a target of around 6.5 per cent for this year, which may be difficult to achieve because of headwinds from the trade dispute.