Rise in Hong Kong home sales brings little cheer to agents

While weekend deals see increase, property agents say volumes evoke Sars era

PUBLISHED : Monday, 05 May, 2014, 5:40am
UPDATED : Monday, 05 May, 2014, 6:40am

Sales of second-hand homes last month saw a rebound from March but property agents find little cheer in the poor overall numbers.

"Sales rose week on week and month on month in terms of percentage, but the actual numbers are still around the levels we saw during the Sars (severe acute respiratory syndrome) days in 2003," said Louis Chan Wing-kit, managing director for home sales at Centaline Property Agency.

Property agents including Centaline reported a significant increase in sales of second-hand homes in 10 major housing estates over the weekend.

Midland Realty reported 24 transactions at 10 major housing estates it tracks - a 50 per cent jump week on week and the highest weekly sales in 10 months.

Hong Kong Property Services (Agency) estimates sales of new and second-hand homes last month may have risen to 5,035 from 3,141 in March.

"In the past 12 months, average monthly sales have been similar to the Sars levels. And thanks to the government's policy, the market is unlikely to recover," Chan said.

Sales of new and second-hand homes fell to 3,649 in February 2003, when Sars broke out in Hong Kong. Deals remained below the 5,500-level until they hit 6,525 in July that year.

In the current slowdown, home transactions fell to 3,427 in April last year, about a month after the government doubled the stamp duty on corporate purchases of properties worth more than HK$2 million. Monthly sales have since hovered between 3,426 and 4,667.

In the primary market, Chan said, 746 new homes were sold last month, far below the average of 1,500 deals. Some developers had cut asking prices by as much as 30 per cent from their peaks levels but secondary home prices have not dropped that much, he said.

After climbing 1.6 per cent over the two previous weeks, the Centa-City Leading Index , which tracks home prices of 100 housing estates, fell 0.6 per cent week on week to Friday.