Used property sales at 10 major private estates hit 16-month low

Government mortgage tightening, persistently high property prices, and the gradual launch of new property projects slash sales of second-hand homes

PUBLISHED : Monday, 07 August, 2017, 7:20pm
UPDATED : Monday, 07 August, 2017, 7:20pm

While small new flats are selling like hot cakes, second-hand, or used, property transactions at 10 major private estates in July in Hong Kong hit a 16-month low, after a three-month slide, according to property agent Centaline.

Only 120 second-hand transactions were recorded in July among 10 major ‘blue-chip’ private estates, down 40 per cent from 199 in June, the lowest since March 2016, which recorded 118 cases, said Wong Leung-sing, associate director of research at Centaline.

The corresponding transaction value also hit a 16-month low of HK$802 million, down 44.3 per cent from HK$1.438 billion in June. March 2016 recorded HK$629 million worth of sales.

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“Reasons of the plummet include the government’s mortgage tightening, persistently high property prices, a wait-and-see attitude among buyers and gradual launches of first-hand property projects which stole the purchasing power for second-hand flats,” Leung said. “The current three-month slide in the transaction cases hit 56 per cent.”

Among the 10 major ‘blue-chip’ private estates, Mei Foo Sun Chuen recorded the biggest drop in July, at 70 per cent compared with June.

Laguna City in Lam Tin and Kornhill in Quarry Bay recorded 50 per cent drops, while Whampoa Garden, Heng Fa Chuen, Sceneway Garden in Lam Tin, Kingswood Villas in Tin Shui Wai and Taikoo Shing all recorded drops of over 30 per cent.

Hong Kong Property chief executive Lee Chi-shing said: “Buyers are opting for new flats instead of second-hand.

“In addition to the high prices, the second-hand market does not have a high supply and has become less attractive as a result. I expect the phenomenon to persist in the short term.”