Hong Kong recorded its second-best year for property sales in 2018 on the back of a red hot first half, in which transactions worth HK$403.7 billion (US$51.5 billion) were reported. However, the market has cooled since August, when a 28-month bull run came to an end, with December recording a 58 per cent year-on-year drop in all property sales.
A total of 79,185 deals worth HK$729.56 billion were completed in the city in 2018. The record for the special administrative region’s property market stands at HK$868 billion, reported in 1997.
“Although we saw the market cooling down in the second half, prices are still at a very high level. This has contributed to the record high value,” said Derek Chan, head of research at Ricacrop Properties.
According to local real estate company Midland Realty, all property transactions last month, including those for apartments, offices and car parks, stood at 3,024 – 23.5 per cent down from November and the lowest figure for December in 28 years.
The numbers for December also represent the lowest monthly transaction volume since March last year, but the bad news does not end here. “Buyers are pondering and trying to figure out where the market is going,” said Ricacrop’s Chan. “Given the macro uncertainties from the US-China trade war, and possibly more US rate hikes during the first half, they won’t move [in the property market] in a hurry.”
Ricacorp said it expected that 50,000 residential units will be sold in 2019, a decline of about 10 per cent from last year, while only 15,800 new flats are expected to be snapped up, which represents a decline of 5 per cent.
