Home sales down 6.3% to 5,337 in December

However, the luxury sector remained active thanks to the traditional year-end bonus distribution.

Home sales fell 6.3% MoM to 5,337 deals in December, according to Knight Frank’s Hong Kong Monthly. 

However, the luxury sector was a bright spot in the year-end sales decline as it remained active with both price and rental indices rising thanks to the traditional season for bonus distribution. 

Knight Frank attributes the strong performance of the luxury sector to the wealth effect from the record performance of the stock market which resulted in further price growth. 

“We believe the uptrend in home prices will continue in 2018 given stable economic conditions and limited housing supply. We forecast that mass residential prices could increase 5% in 2018, while luxury home prices could increase 8%,” Knight Frank said, adding that the three expected Fed rate hikes is unlikely to have a significant impact on housing prices.