Property resales market revives
Updated: 2010-12-21 07:02
By Oswald Chen(HK Edition)
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Signs of life as effects of government anti-speculative measures subside
Sales in the local secondary property market are showing signs of recovery after taking a nasty fall in the wake of the government's anti-speculative measures last month.
Local real estate agent Centaline Property Agency's latest figures showed that there were 66 sales in what it refers to as the city's "10 traditional private residential neighborhoods" this past weekend, a rise of 25 percent on the week before.
Further statistics from Midland Holdings showed that sales in the city's "35 private residential neighborhoods" rebounded to 245 in the past week after hitting a low of 75 the week before.
Property analysts said that although local home prices and property sales will not return to the high levels seen prior to the announcement of anti-speculative measures in the short run, they are still bullish about the market for 2011.
"Genuine home buyers and long-term real estate investors seem to have priced in the government's anti-speculative measures and see quality apartments as cheap bargains," said Midland Realty Chief Analyst Buggle Lau. "We are revising upwards the number of property transactions in the city to 132,000 in 2011 from 119,000."
However, the 2011 estimate will still be 17 percent lower than the 160,000 transactions predicted for 2010, Lau said, adding that local property price growth will moderate at around 11 percent as local home prices have increased nearly 40 percent in the past two years.
Lau added that the government should increase land supply in order to tackle soaring property prices in the long run, however.
"Under the macroeconomics environment of low interest rates and a weak Hong Kong dollar, local residents want to hedge their capital against inflation," said Centaline Property Agency Managing Director Louis Chan. "So buying properties will be their preferred investment channel to protect their capital assets."
He added that both genuine home buyers and long-term property investors are currently hunting for bargains either for their own use or to rent out, therefore secondary market sales begin to pick up again.
"We think that the government's measures can make local home prices more sustainable as short-term property speculators have almost been driven out of the market," Chan said. "We forecast that local home prices should be stable in the future and may post a 3 to 5 percent increase in the first quarter of 2011."
The Hong Kong government unveiled tough measures against property speculators on November 19 by levying a special stamp duty, tightening down payment ratios in home mortgage loans and abolishing the practice of deferring stamp duty payments.
China Daily
(HK Edition 12/21/2010 page2)