C’s point of view｜Although housing transactions are picking up, there is still no need to delay measures to rescue the market
Since entering 2024, transaction volume in Hong Kong’s real estate market has picked up slightly. There were no large-scale new launches in the primary market, and attention returned to the secondary market, causing transactions in the secondary market to increase by nearly 25% compared to the previous month. Among them, the transaction volume of Taikoo Shing, Mei Foo Sun Estate, Whampoa Gardens and Kingswood Villas exceeded double digits in the first half of the month.
At present, the second-hand building market is full of goods, and the owners’ mentality is weak, so the price is negotiable. If you encounter an owner who is eager to sell, you will have the opportunity to “catch the treasure” every minute. Taking Kingswood Villas as an example, when the price dropped to its lowest point, it once fell below the 8,000 yuan per square foot level, which is not far from the selling price of Home Ownership Scheme housing.
However, this situation is short-lived and never seen again. This will make those who are interested in thinking that property prices are forming a support level, so they should act more decisively when encountering a new market, otherwise they may miss the opportunity.
The reality is that property prices in Hong Kong have dropped by about 25% from their highs, and have fallen much further, to close to 30%, which has fallen within the affordability level of many people. In addition, interest rates are likely to peak and fall, while rents are gradually rising. Users’ rigid demand may shift from leasing to buying.
The reality is that Hong Kong’s real estate market is still in an environment where supply exceeds demand, which is why property prices do not rise but rents rise. If China’s basic economic conditions improve further, buyers’ willingness to enter the market may further increase.
According to information provided by frontline colleagues, the sales of luxury homes have been more prominent recently, and the number of cases under negotiation is half as much as in the previous stage. Many of these buyers come from the Mainland. Their children have highly qualified or professional qualifications and can save a lot of stamp duty. Therefore, they are ready to move. They are a new force in Hong Kong’s luxury housing market and can bring new trends to Hong Kong’s property market. power.
Although the trading volume in Hong Kong’s property market has shown signs of recovery recently, it is only an improvement compared to before. Compared with the average trading volume in the past, it is still only about 60% of normal. With this level of transaction volume, efforts should be made to cater for the sales needs of both the primary market and the secondary market. Developers still need to make more concessions in selling prices before launching the property.
In this case, it is impossible for developers to be too active in increasing land reserves. In order to prevent property prices from continuing to be dragged down by low land purchase transactions, the Development Bureau has decided to suspend the launch of residential and commercial land in the first quarter of this year.
This approach is not conducive to the government using the revenue from land sales to make up for the shortfall in the treasury, and is not a long-term solution. If the government is serious about stabilizing the property market, it can withdraw its outdated measures instead of suspending land sales.
At present, market confidence is already very fragile. The government should take the opportunity to give the market two more boosts before a downturn in the property market takes hold. Market estimates suggest that the Hong Kong property market may experience an Indian Summer after the Lunar New Year. The government should take advantage of the favorable situation and launch more powerful market stabilization measures than before to enhance the effectiveness of the policy.
Some people in the government are worried that if such measures to stabilize property prices are introduced again, property developers may become overly excited, causing property prices to rise out of control again, and the government will be criticized by society again. But the chance of this happening is very slim, and the government need not be unreasonably worried.
2024-01-17 20:30:23
#building #transactions #picked #measures #rescue #market #urgent #am730
