Distress sales among Chinese homeowners in Hong Kong’s upscale Mid-Levels district on the rise amid stock market slump
- Between 10 and 20 per cent of mainland homeowners in Mid-Levels have reduced prices as they are in dire need of funds, says Midland’s Samuel Lai
- Property prices in Mid-Levels are expected to fall by another 5 per cent by the end of June after dropping by as much as 15 per cent since Lunar New Year
Mainland Chinese owners with luxury homes in Hong Kong’s upmarket Mid-Levels area are offloading their properties at deep discounts to cover their stock market losses, which is mired in a prolonged slump.
About 10 to 20 per cent of mainland homeowners in Mid-Levels have reduced prices as they are in urgent need of funds or shedding their holdings, said Samuel Lai, senior district sales director at Midland Realty.
“Homeowners in urgent need of money may cash in for having burnt their fingers in the stock market,” said Lai, who estimates another 5 to 8 per cent will lower their asking prices until the pandemic and stock market volatility ease.
Hong Kong’s stock market has been affected by a range of factors over the past few months. Last week the benchmark Hang Seng Index fell to a near 10-year low amid concerns about Covid-19 outbreaks in China, Russia’s invasion of Ukraine and higher interest rates in the US.
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The latest price index compiled by the city’s Rating and Valuation Department for lived-in homes larger than 1,722.23 square feet shows that prices have fallen 9.1 per cent between March 2021 and January this year. Bigger homes generally showed larger price declines compared with the overall trend.
Property owners in Mid-Levels have cut prices by up to 15 per cent since Lunar New Year because of the aggravating factors, Lai said, adding that prices may fall further by another 5 per cent until midyear.
