Sales of used homes in Hong Kong gain momentum as owners slash prices
- The number of transactions at 50 major private housing estates hit a 40-week high of 138 in the week ended February 3, according to Ricacorp Properties
- Total sales of all types of property that changed hands in January marked a six-month high of HK$70.53 billion, up 63.8 per cent from December
Sales of used homes on big housing estates in Hong Kong gained momentum last week as homeowners offered greater discounts and investment banks forecast house prices would hit a nadir in March.
The number of transactions at 50 major housing estates, tracked by Ricacorp Properties, stayed above 100 for a fourth consecutive week, reaching 138 in the week ended February 3, a 40-week high.
“Owners are less aggressive with their asking prices. Prices are generally down 5 to 10 per cent from the peak,” said David Chan, director of Ricacorp Properties. “Buyers know prices are lower so they are willing to go look for homes.”
For instance, a flat measuring 336 square feet at Golden Lion Garden was sold for HK$4.7 million (US$599,086) on Wednesday after the asking price was slashed by HK$490,000 in light of falling home prices.
The figure came after CLSA, Citibank and JPMorgan said home prices will rise by up to 15 per cent between April and December amid high market liquidity and pent-up demand from people new to Hong Kong.
Their predictions followed a 9 per cent drop in Hong Kong’s home prices from their peak in July and pushed 262 homeowners into negative equity in the fourth quarter last year. It was the first time in two years that some property values had dropped below outstanding mortgage loans, the Hong Kong Monetary Authority said last week.