Prices edged up 1.3% due to as costs for small-and-medium sized units rose.
Hong Kong’s housing market witnessed a sales rebound in March, after total residential sales volume soared 27.9% MoM to 5,231 units, making it the first month with over 5,000 monthly transactions since July 2018, Knight Frank said, citing Land Registry data.
Overall property prices increased 1.3% MoM from February led by a rise in costs for small and medium-sized units. In February 2019, the proportion of sales transactions involving Double Ad Valorem Stamp Duty (DSD) dropped to 5%, which was the lowest point since the revised DSD took effect in November 2016.
Knight Frank further noted that the DSD cases in Q1 2019 accounted for only 8% of the total number of transactions.
Meanwhile, the proportion of sales transactions involving Buyer’s Stamp Duty (BSD) also declined, accounting for only 3% of total transactions in Q1 2019, compared to 8% in Q4 2018.
“This indicates that both non-first-time buyers and overseas buyers are retreating as tax burdens kicked in,” David Ji, Knight Frank’s director of research and consultancy for Greater China, explained.
Entering the traditional peak season in March, the luxury leasing market also saw a rebound in transactions, as some districts such as Mid-levels Central and Happy Valley recorded active leasing activity.
“Landlords have remained firm in their negotiations. The government has tabled a proposal for a vacancy tax, officially known as “Special Rates”, which will levy a tax equivalent to 200% of the rateable value of primary homes that have not been sold or leased for 6 months or more,” Ji said.
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