Although some analysts now predict home prices are poised to rise in Hong Kong, some jittery sellers just want out
- Examples abound of flats whose asking prices have been slashed
It’s suddenly up for debate in Hong Kong which way home prices will next go. But one thing is clear: some property owners just want out.
Take at look at a 18 Ventris Road site in Happy Valley. The owner recently slashed the asking price by 17.6 per cent to HK$140 million (US$17.84 million) from HK$170 million.
In recent months, the site was approved for construction of a three-storey home with a basement. But the owner is likely anxious about the clouded market and wants to sell, said Anthony Hsu, an agent at Midland Realty.
Other examples include a 575 square foot flat at Tuen Mun’s Parkland Villas that sold today for HK$6.4 million, or HK$11,130 per square foot. That was down HK$1.4 million from the original price.
Another 617 square foot flat at Fo Tan’s Sui Wo Court sold at HK$5 million, or HK$8,104 per square foot, after a reduction of HK$1.5 million, or 23 per cent, off the original asking price.
“At the moment, when the market is undergoing correction, it is definitely a better time [for buyers] to ask for lower prices than when the market is booming, when prices rise without room for price cuts. Now is the buyer’s market.”
Hong Kong’s property market has been in a downturn since August, when a 28-month bull run ended. Analysts had forecast a drop in home prices in 2019 of up to 20 per cent. Since August, prices of new homes have dropped nearly 10 per cent, according to Centa-City Leading Index.
But recently, Nicole Wong, regional head of property research at CLSA, and some other analysts have said they think the worst is over for falling prices, with prices stabilising in March and rising by up to 15 per cent by December.
The debate over prices comes as government officials look for ways to boost supply of flats in the world’s least affordable housing market. They’ve done such things as teed up a vacancy tax on developers who hoard empty flats and offered more subsidised flats.
Where prices are headed is hugely important to everyone from owners, buyers and developers to the myriad of jobs tied to the sector.
But David Ji, director and head of research and consultancy of Greater China at Knight Frank, still expects residential prices will fall 10 per cent this year.
“Home price rose a lot in the previous 28-month rally, Ji said. “A lot of homes in remote places were priced as expensively as those in urban areas. The correction by several per cent now is reasonable amid the current instability in the external environment.”
