Hong Kong property sales fall amid call for help for young buyers

Taylor Scott International News

Residential property sales in Hong Kong decreased by 28.2% in March due to the introduction of a seventh round of market tightening measures, according to the latest analysis report. The move by the Hong Kong Monetary Authority is supressing the housing market amid calls for more housing to be built to measures put in place to help young first time buyers, says the report from international real estate firm Knight Frank. It also shows that mass residential sales below HK£10 million dropped almost 30% but prime residential sales above this price level saw a lower fall at 16.2%. The report points out that the tightening is being felt the most at HK$7 million and below. Despite the fall in sales, prices in the mass residential market increased by another 2.6% in March while luxury property prices remained stable. ‘To tackle the housing problem in Hong Kong, Knight Frank believes that the government should not focus on supressing housing demand, but effectively increase housing supply and provide assistance to first time home buyers,’ the report says. ‘The government should ease restrictions on mortgage lending for first time and young home buyers, perhaps by following the example of Singapore which has applied age conditions on housing mortgage loans,’ it explains. The report also shows that the office sales market was more active in March compared to February. Decentralised areas in particular saw some large transactions. It says that the latest initiatives launched by the Chinese government, including the establishment of the Asia Infrastructure Investment Bank and the proposed Shenzhen to Hong Kong through train will inevitably increase capital flow in the region. ‘Hong Kong being a global financial hub situated at the cross roads of Asia is set to benefit from this. We expect this to translate into increased commercial activity which will stimulate demand for office space from related industries taking the opportunity to expand their business in the city,’ the report points out. ‘As a result we remain optimistic about the office market in Hong Kong. Given the limited supply of office space and sustained demand from Chinese firms and certain industries, we expect Grade A office rents to rise by up to 5% during the year,’ it adds. Continue reading →

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