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Hong Kong residential property sales soar after scrapping of market curbs

But the increase in sales over the past month has not yet translated into higher house prices, an industry leader says.

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ARTICLE BY

PUBLISHED

READING TIME

Less than 1 minute Minutes

The chairman of Hong Kong Estate Agents Authority says ending decade-old market curbs has been “a shot in the arm” for the SAR’s ailing property market, the South China Morning Post reports.

Simon Siu told the Post that the market had “returned to normal” after years of decline. “We have seen a doubling of transactions in the property market, especially in the residential sector,” he noted. Property agency giant Midland Realty said its transaction volume was 1.5 times higher than last year’s average.

Property prices have thus far remained flat, however. The executive director of Centaline Surveyors, James Cheung, explained this as due to sellers’ cautious view of Hong Kong’s economic prospects. 

[See more: Macao’s realtors call for an end to all market cooling measures]

“Even the price increase for first-hand properties has remained small as developers scramble to sell off their unsold units,” he told the Post, but added that “feel-good factors,” like an expected decrease in interest rates later this year, should further boost the market.

The Hong Kong government ended its market curbs on 28 February, bowing to mounting pressure from the SAR’s real estate sector and homeowners. 

Hong Kong’s financial secretary declared that the measures – which included onerous stamp duties and other imposts designed to rein in property speculation – were “no longer necessary amid the current economic and market conditions.”

[See more: The property market is down 5.6 percent year-on-year]

The Macao government is facing the same pressure, with realtors urgently calling for further reductions to local cooling measures. They claim that steadily sinking residential property prices will eventually have a detrimental effect on society and the economy.

Official figures show that the volume and value of residential properties sold in Macao in 2023 were at about 65 percent of 2019’s pre-pandemic levels. Year-on-year, the residential property price index is down 5.6 percent, and has fallen for 7 consecutive reporting periods.

The government did relax some of its cooling measures this year, including scrapping a 5 percent stamp duty aimed at buyers of second homes. These were implemented in 2010 in an effort to curb property speculation.

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