Six in 10 say they won’t consider buying homes until Hong Kong prices drop

PUBLISHED : Monday, 16 December, 2013, 3:40pm
UPDATED : Tuesday, 13 January, 2015, 11:27am

Almost six in 10 people say they will not consider buying homes in Hong Kong unless prices fall 20 per cent or more, according to a survey by Midland Realty.

It comes as an increase in supply of new flats could force developers to further cut prices next year, the agency said.

About 58 per cent of respondents in the poll on the property market outlook 2014 by the agency - owned by locally-listed Midland Holdings - believed there was heavy downward pressure due to fears that the government would roll out further anti-speculation measures to curb price growth.

“The result indicated prices will be a key reason for buying decisions,” deputy chairman Angela Wong Ching-yi of Midland Holdings said today.

Just 18 per cent of respondents believed prices would have an upside potential, and 48 per cent of them said they would sell their flats in anticipation of an imminent rise in interest rates that could add pressure on their financial ability.

Looking ahead, she expects home prices to drop five to 10 per cent as the market sentiment has been severely hurt by the government’s curbs to cool the property market.

“Next year will be a bad year,” she said.

The total number of secondary residential transactions could tumble to below 40,000, down from this year’s estimated 42,000 deals.

“It will be the lowest in the past 19 years,” she said.

In contrast to secondary residential market, she forecast developers offering discounts and low-pricing strategies to lure buyers to the primary market next year.

It would boost the sales of new homes to 11,000 units, from an estimated 9,000 flats this year.

Including apartments, office, retail, industrial units and car parks, she said the total number of property transactions would drop 7 per cent to 65,000 deals, as compared 70,000 this year.

With the bearish outlook, Midland Holdings last Friday issued a profit warning, saying it expected to record a consolidated net loss for the second half of this year.