Record High Potential Supply of Private Housing Reaches 112,000 Units – Latest Housing Bureau Report

The potential supply of private housing reaches 112,000 units and has hit the ceiling again, with a sharp increase of 3,000 units quarter-to-quarter The housing bureau is expected to continue up in the future.

The withdrawal from the property market resulted in brisk trading in the primary market in March, but the potential supply of private dwellings rose instead of falling. The latest data from the Housing Bureau shows that, at the end of March this year, the potential supply of private housing (potential supply) in the three or the next four years exceeded the 110,000 mark for the first time, reaching 112,000 units, setting the highest level for two consecutive quarters. The Housing Bureau expects the potential supply to remain high for the foreseeable future.

The inventory of properties and properties for sale is at an all-time high

Potential supply has exceeded 100,000 units since the fourth quarter of 2022. In the first quarter of last year, it hit a new high of 107,000 units since records began in 2004. It fell back to 105,000 units in the second quarter, but then rose to The number of units reached an all-time high of 107,000 units again in the fourth quarter last year, hitting a new high of 109,000 units in the first quarter year, it crossed the 110,000 unit mark, rising by another 3,000 units or 2.8% quarter to quarter and 4.7% year on year.

According to the Housing Bureau’s calculation method, the potential supply includes completed residential buildings (the end of the existing building stock), private residential units under construction but not for sale (buildings off the plan for sale), and approved land. (ie, developed land). All three figures each increased by about 1,000 units quarter to quarter in the first quarter of this year, increases for the second quarter in a row;

The Housing Bureau indicated that of the potential 112,000 units, approximately 96,000 units are estimated to be small and medium-sized units with a usable floor area of ​​less than 753 square feet, accounting for approximately 86% of total supply The ratio will increase by around 1 percentage point quarter after quarter Expected in the coming months There are still 5 residential sites that can be converted to land​​​​ developed, including approximately 3,100 additional units. The bureau confirmed that as the government continues to increase the supply of housing and land in an orderly manner, the potential supply will remain at a high level.

The Bureau also announced at the same time the latest private residential construction and completion figures A total of around 5,000 units were completed in the first quarter of this year, which was a four-quarter high since 6,800 units were recorded in first quarter of last year. Although it was about 26.5% lower year-on-year, it was still lower than the previous quarter’s increase of about 31.6%. Compared to the forecast of the Evaluation and Evaluation Department (Rating and Evaluation Department) of 22,267 units completed in 2024, the completion rate in the first three months of this year has reached about 22.5% of the annual target. Regarding the volume of construction in the first quarter of this year, it was 4,300 units, a quarter-on-quarter decrease of 21.8%, and a significant increase of about 87% compared to the same period last year.

A total of around 5,000 units were completed in the first quarter of this year, a four-quarter high since 6,800 units were recorded in the first quarter of last year. (CHUNYIP WONG via Getty Images)

Looking at the main market situation, in the first two months of this year, developers were slow to launch projects due to high interest rates and the market was waiting to see if the Budget would allow good news out. However, after the government announced at the end of February that the property market was cooling down, trading sentiment was booming. In March alone, around 4,170 new units were completed, the number one highest month in about 11 years since the investment was implemented. Residential Property Sales Order in April 2013. Among them, approximately 1,928 units (about 46.2%) are existing units. Although personal properties are selling well, the supply and potential backlog are still at record levels, surprising the market.

The new project is very popular and ready to go soon.

Liu Jiahui, chief analyst of Midland Realty, explained that more than 4,800 first-hand units were sold in the first quarter of this year, the highest in 19 quarters (in the past five years, although However, about 5,000 units were completed in one quarter, and the unsold units were immediately converted to existing units. Liu Jiahui expects the number of completions throughout this year to remain at a high level Even although developers will actively encourage sales volume, it will be difficult for the existing housing stock to fall significantly in the short term.

Ye Wenqi, vice president of the United Hong Kong Fund, pointed out that the effect of removing spicy food may not be fully reflected in the potential supply data in the first quarter, and a comprehensive judgment is required combined with the second quarter data. . Regarding the high supply shortage of existing properties and the highest number of pre-sale properties, Ye Wenqi believes that the market continues to suffer from stock loss, and the decline in construction volume indicates to some extent that the market may be gradually adjusting supply. reduce the collection of main menu.

Wang Zhaoqi, Knight Frank Director and Head of Research and Consulting in Greater China, said that Hong Kong’s real estate market did not perform well before the “retirement”, sales of new projects were not satisfactory, and the number of developable land units remain at a high level, making the total potential supply high. Influenced by the backlog of new projects, developers are expected to offer more discounts and financing plans to attract buyers when launching projects. . The bank is cautious about the performance of property prices this year. a whole year.