Hong Kong’s home buying fever continued unabated in the first quarter, after purchasers splashed out a record HK$47.5 billion (US$6.11 billion) on new apartments – the biggest buying spree ever, according to the latest figures from Midland Realty, the city’s only listed property agent. But industry experts are now predicting the trend to slow considerably, after the Hong Kong government new policy last week, whereby any local first-time buyer of multiple units in one contract must now pay a 15 per cent stamp duty for each flat bought, finally closing a legal loophole left open since November. In the first three months of 2017, there were more than 3,580 registered transactions in the primary residential market, almost tripling from 1,323 deals in the same period in 2016. “It is the highest transaction value for new flats in first quarter since we started collecting the data in 1996, when only the government offered a breakdown of the numbers for residential and commercial transactions,” said Midland’s chief analyst Buggle Lau Ka-fai. He attributed the hefty increase to the steep rise in home prices, which have encouraged developers to speed up their marketing for new project launches. Year-on-year, the total transaction value of new private flats jumped 180.8 per cent from HK$16.91 billion in 2016, it said, another record-breaking performance. “But the new tax policy will affect investor sentiment. The figure may fall [in the next quarter] if developers release more mass housing projects in the New Territories in view of fewer investors being allowed to buy several flats in one go,” said Lau. Sales of new flats have already showed signs of slowing at Poly Property Group’s Vibe Centro in the Kai Tak area, the second residential project put on sale since the new 15 per cent levy on multiple purchases was introduced. The new tax policy will affect investor sentiment. The figure may fall [in the next quarter] if developers release more mass housing projects in the New Territories in view of fewer investors being allowed to buy several flats in the one go Buggle Lau, chief analyst at Midland Realty Buyers snapped up 31 of the 93 units at Vibe Centro during a two-day sale from Friday in the third round of sales. Undeterred by the curbs, however, Sun Hung Kai Properties (SHKP) announced it would put 118 units at Eight Regency in Tuen Mun on the market on Thursday. The average prices for the first batch, ranging in size from 328 to 497 square feet, are being offered at between HK$3.95 million (US$508,000) and HK$6.5 million, after discount. Home prices in Hong Kong – now considered the world’s least-affordable major city – rose for the 11th consecutive month to record in February, underscoring the scale of the task facing chief executive-elect Carrie Lam Cheng Yuet-ngor in reining in runaway prices. February’s home price index, which represents home price movements in the secondary or used market, rose 1.1 per cent to 312.8 from January’s 309.4, according to the Rating & Valuation Department. Prices rose 14.3 per cent in February from a year earlier and have risen 1.8 per cent since the beginning of this year, the data showed. Vincent Cheung, deputy managing director Asia for valuation and advisory services at Colliers International, expects the new tax 15 per cent multiple-buyer rule to slow the pace of price growth. “Prior to the new tax taking effect, rising numbers of multiple flat buyers, who might buy five or more flats in one go, led to higher expectations that property prices would increase further. “Prospective buyers are still convinced that prices for the next batch of units will be more expensive if they do not act fast,” he said, adding the bigger stamp duty will reduce the number of multiple spenders. Prices of new projects have continued to rise sharply, with tens of thousands of prospective registered buyers still scrambling to secure a limited number of new flats. At the Cullinan West project, for example, being built on top of Nan Cheong Station, developer SHKP raised prices 40 per cent in less than a month, after registering as many as 12,000 prospective buyers. The developer had pulled in nearly HK$14 billion in sales for more than 90 per cent, or 960 units of the 1,050-unit Cullinan West phase one development, since it was launched on March 18. More than 30 per cent of transactions at Cullinan West involved in buyers purchasing several units in one contract.