RESIDENTIAL PROPERTY | Staff Reporter, Hong Kong

Housing market cools down as transactions fell for fifth straight month

The outlook for the property sector remains muted as indicators declined in Q3.

Hong Kong’s overheated housing market is expected to remain subdued over the next 12 months with broad-based indicators declining in the latter half of the year as cooling measures are starting to kick into effect, according to a macro outlook from OCBC Bank.

Housing transaction volumes fell for the fifth consecutive month by 16% YoY to 5,694 deals in November.

Additionally, approved new residential mortgage dropped for the second month in a row in October by 15.2% YoY whilst growth in secondary housing prices index plopped to its lowest point since January at 12.5%. 

This comes as overall efforts to cool down Hong Kong’s overheated property market appear to be kicking into effect after the Hong Kong Monetary Authority announced a series of tightened lending measures earlier this year.

Reuters reports that HKMA has enforced eight rounds of mortgage tightening measures since 2009 in addition to tax and regulatory policies.

OCBC Bank expects the housing market to remain largely muted in the coming year as increased selling prices of new homes appear to be absorbed less and less by prospective homebuyers.

“Moving forward, should global monetary tightening lead HK banks to lift prime rate and result in HK stock market correction, housing demand may take a hit,” OCBC added.

Photo from Baycrest - Own work, CC BY-SA 2.5


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