Hong Kong luxury homes set for a rebound as developers pin hopes on border reopening, buying power from mainland investors
- Transaction volume of luxury homes could rebound by 30 to 40 per cent in the second half of 2022 on resumption of normal business
- City has approved 13 projects for presale this year through late March, with luxury projects accounting for eight of them
Transaction volume of luxury homes could jump by 30 to 40 per cent in the second half from the first half, said John Fong, chief district sales director at Midland Realty. First-quarter sales of homes priced above HK$50 million (US$6.37 million) fell by a sequential 36.3 per cent, the worst since late 2020 because of the fifth wave of pandemic, stock market losses and fears over higher borrowing costs.
The Federal Reserve has raised its key interest rate twice this year, followed in lockstep by Hong Kong’s monetary authority under its linked exchange rate system. Still, local banks have refrained by lifting their lending rates amid a shrinking economy.
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“The market has digested the interest-rate hike factor,” said Helen Fung, deputy director of sales at Chinachem Group. “The recent boom in the property market reflects confidence in entering the market.”
Developers had 13 new property projects approved citywide for presale by the government but not yet launched as of late March, offering a total of 2,582 units, according to Hong Kong Economic Times. Luxury residential projects accounted for eight of them.
Kowloon Development last week sold the last flat at Cadogan in Kennedy Town for HK$104 million, a duplex measuring 2,167 square feet. At HK$48,000 per sq ft, the unit is the most expensive in the development, reflecting underlying appetite among local buyers.
