Buyers return to property market
Property transactions rebounded significantly last month from a 15-month low as price declines lured buyers back into the city's market.
Data from the Land Registry yesterday showed it received 5,288 property sale and purchase agreements for registration, 20.5 per cent more than in April. Year on year, the figure fell 54 per cent.
Residential transactions jumped 24.8 per cent to 4,276.
"As home prices decreased gradually, end-users quickened their pace in returning to the market," said Patrick Chow Moon-kit, the head of research at Ricacorp.
"With the introduction of the Residential Properties (First-hand Sales) Ordinance, the primary flat market lacked attraction and drove buyers and agents back to the secondary market."
The value of home sales last month totalled HK$24 billion, up 28.4 per cent from April. The total value of all property sales fell 2.4 per cent to HK$31.1 billion.
"Sales volume may climb by a few hundred this month because of an improved market," said Centaline Property Agency research head Wong Leung-sing. "But the figure is still very low, actually."
Wong said transaction costs, such as stamp duty, had increased after the government's tightening measures, and home prices would not drop much before interest rates rise in about two years.
As a result, residential transactions were unlikely to jump, he said.
Land Registry figures mainly relate to sales in the previous month, as deeds can be lodged 30 days after the transaction.
Jeffrey Ng Chong-yip, a senior executive director of Hong Kong Property Services, expects total property transactions to remain at about 5,000 in this month's data, as few primary housing projects hit the market in May, although secondary flat sales rose.