Hong Kong developers unlikely to increase prices of new flats as they try to offload 8,500 unsold units, Centaline says

Hong Kong builders will probably leave their prices virtually unchanged in the second half of the year, having accumulated close to 8,500 unsold units since 2016, according to Centaline Property Agency.

The developers may be keener than they have been in the past to offload the stock because of the government’s proposed “vacancy tax” which would penalise them for holding on to finished units.

“Developers will hardly want to increase selling prices by 20 to 30 per cent like they did in the first half of this year as buyers will have more choices,” said Wong Leung-sing, a senior associate director at Centaline Property Agency.

“Developers will release additional units in the subsequent batches either at the same as the launch price or just edged up a by meagre increase.”

Although still high at 8,500, the number of unsold apartments in Hong Kong has declined for three consecutive months as developers sped up sales in the first half of the year to cash in on positive market sentiment and to avoid the new levy on unoccupied flats. The agent said there were 10,000 unsold units in 2018.

“The vacancy tax may be one of the reasons for the fall in their holdings of unsold flats,” said Wong.