Greater Bay Area home sales to jump up to 25 per cent in 2023, with Hongkongers finishing on-hold buys, forecast says
- New-home transactions in the 11-city megalopolis will hit 500,000 in 2023, returning nearly to pre-pandemic levels, Cushman & Wakefield says
- On the commercial side, the GBA accounted for 29 per cent of China’s real estate investment in 2022 – the highest level since 2018, the firm reports
Home sales in the Greater Bay Area (GBA) will increase by 20 to 25 per cent in 2023 compared with 2022, supported by the relaxation of mainland China’s Covid-19 restrictions and the reopening of the border with Hong Kong, according to international real estate firm Cushman & Wakefield.
Total home transactions in the multi-city megalopolis around the Pearl River Delta will hit 500,000 in 2023, returning nearly to pre-pandemic levels as improving market sentiment fuels activity, especially in the second half of the year, the firm said on Wednesday.
“Despite an overall slowdown of residential transactions in 2022 due to Covid-19 and a crisis in the mainland property market, home purchases among the 11-city cluster are expected to rebound in 2023 driven by the relaxed national pandemic policies as well as border restriction,” said Alva To, Cushman’s vice-president and head of consulting for Greater China.
Buyers bought 400,000 new homes in GBA in 2022, a 35 per cent plunge compared with 2021.
Hong Kong buyers heading over the border to finalise previously on-hold transactions will support the market recovery in 2023, To said.
“However, the market momentum will not see a surge in the first six months, until the reboot of the country’s economy and a recovery of people’s willingness to buy homes,” he added.
New-home prices across the GBA are expected to stabilise as price corrections narrow amid the relaxation of pandemic rules, the company said.
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On the commercial side, the total value of investment in the GBA grew 15 per cent in 2022 to 64.9 billion yuan (US$9.6 billion) compared with 2021, Cushman said.
This accounts for 29 per cent of China’s total deal value – the highest proportion since 2018 – thanks to a high number of GBA deals valued above 100 million yuan, the firm reported.
Shenzhen contributed 44.2 billion yuan of GBA’s total commercial investment, surpassing Beijing to become the second-highest ranked city across China. Shanghai remains in the top spot.
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Reasons for Shenzhen’s growth include rapid development of the city’s industrial sector and investments in new economy assets such as industrial estates, logistics facilities and data centres, said Charli Chan, Cushman’s executive director of capital markets for Greater China.
Traditional sectors such as office and retail are also expected to pick up in the second half of 2023, she said.
The GBA aims to integrate the cities of Hong Kong, Macau, Guangzhou, Shenzhen, Zhuhai, Foshan, Zhongshan, Dongguan, Huizhou, Jiangmen and Zhaoqing into an economic and business hub.
