Hong Kong’s home completion falls 37 per cent short of target, exacerbating housing woes in one of the world’s most expensive city
- By the end of November, just 63 per cent of the full-year target had been reached, with analysts blaming a construction slowdown as protests sapped demand
- Developers may also have slowed down to avoid an impending vacancy tax that will penalise them for vacant units, said analysts
The Hong Kong government looked likely to fall well short of its 2019 target for completion of new flats, according to official data released on Tuesday.
By the end of November, it had achieved just 63 per cent of the full-year target, with analysts blaming a slowdown in construction as escalating anti-government protests in the second half of the year hit the economy and sapped demand for new homes.
A total of 12,925 new flats had been built as of November 30, well shy of the government forecast of 20,415 made in early 2019. The gap, at 37 per cent of the government’s target, would be the biggest annual shortfall since 2013, according to research by JLL, citing data by the Rating and Valuation Department.
The shortfall, the first in three years, would exacerbate housing woes in one of the world’s most expensive urban centres, at a time when public grievances against the government are running at a historical low after seven months of anti-government protests.
“Developers will have reviewed their pace of construction after seeing an abrupt change in market sentiment when the city was rocked by the protests since June,” said Vincent Cheung, managing director of Vincorn Consulting and Appraisal.
“It is the lowest completion of new flats since 2016,” said Derek Chan, head of research of Ricacorp Properties.
2018 saw 15,703 flats built to completion. In 2017, the number was 14,611, and in the first 11 months of 2016 the number of completed flats was 12,061.