Prices in mass housing market tipped to bounce back in Macau

Macau's residential market is poised to start bouncing back next month after stalling in June and July as a result of the curbs put in place by the government, analysts say.

While the level of activity may not return to pre-control levels any time soon, there is now a positive outlook for the medium term, underpinned by rising wealth in the city amid expectations of further expansion of its economy, they say.

"By next month homebuyers, property owners, developers, and agents will have adapted to the new regulatory regime," said Ronald Cheung, chief executive of the Macau unit of Midland Realty. "Activity will rebound since there is lots of pent-up demand after both homebuyers and sellers took a wait-and-see attitude towards the new regulatory regime during the past two months."

Sales of new mass-market homes collapsed to single-digit levels in June and July, versus the average of 1,700 to 2,000 deals a month, he said.

"I now expect a volatile market in September from many buyers who held back their purchases in the past three months, as scores get back to work from their holidays, and as market players must by now be used to the new regulations," Cheung said.

In June, the Macau government enacted a law requiring developers to complete the foundations of a building and obtain pre-sale approval before they can start selling them.

It then mandated the registration of estate agents and required property owners to issue written authorisation before the agents could offer their properties for sale.