New | Hong Kong home prices rose 2.6pc in October to highest level in a year
Luxury home sales in the secondary residential market frozen by rising property tax
The prices of new homes in Hong Kong climbed 2.6 per cent in October to one-year highs, but higher stamp duty and an imminent rise in interest rates in the United States are expected to cool the buying fever, market watchers say.
The monthly price index for private homes stood at 303.8 in October, 0.75 per cent below the peak in September last year, according to data released by the Rating and Valuation Department on Wednesday.
“The pace for home price growth will slow over the next few months,” said Thomas Lam, a senior director at Knight Frank, pointing to the impact from November’s increase in stamp duty to 15 per cent.
For the full year, Lam said he now expected to see a drop of 2 per cent to 3 per cent in prices from their peak in September last year.
Hong Kong remained one of the most expensive cities to own a home, with developers continuing to build small flats to make it affordable for younger, first-time buyers.
Chun Wo Property Development Holdings, a unit of Asia Allied Infrastructure Holdings, is the latest developer to build the city’s tiniest flat.
Inspired by the concept of student quarters, the company’s soon-to-be released project, TPlus, in Tuen Mun includes studio flats with sizes ranging from 128 sq ft, the smallest in Hong Kong.