A government housing adviser has forecast Hong Kong home prices should tumble 20 per cent before reaching what he regards as a reasonable level, reiterating the latest round of cooling measures would be effective in curbing investment demand.
"Buyers have changed their price expectations after the rolling out of curbs [in late October]," said Stanley Wong Yuen-fai, chairman of the subsidised housing committee under the Housing Authority and a member of the Long Term Housing Strategy Steering Committee.
Without giving a timetable, he believes a 20 per cent price correction would bring prices down to the level seen earlier this year.
His remarks came as Centaline Property Agency' s secondary home price index eased by 0.55 per cent for the week of November 18, after hitting a record high of 116.81 points the previous week. The Centa-City Leading Index compiled by the agency, which tracks prices at 100 mass- and luxury housing estates across the city, recorded its first fall in the past eight weeks after a 15 per cent stamp duty was introduced on companies and non-permanent residents who buy homes in the city from October 27.
Home prices have shot up by 20 per cent since January.
Other analysts have different views on the market outlook.
Adrian Ngan, analyst at Citic Securities International, expected home prices to drop 3 to 5 per cent in the next six months.