More homeowners offer discounts to offload properties as market sentiment weakens.
Hong Kong’s luxury home values dropped 8.6% from the peak in Q2 2019, according to JLL’s Residential Market Monitor. Likewise, luxury rentals have fallen 5.8%, the sharpest fall for the Q2 period since 2017.
In addition, more homeowners are offering discounts to offload properties, aiming to lock in profits or to reallocate capital as market sentiment continues to weaken.
The local luxury property market is also likely to face increasing pressure in the short run with challenges, such as job losses and the prospect of a deeper recession.
On the other hand, the slacking leasing market is largely a result of the falling number of expatriates who have driven the leasing demand notably for high-end properties. The decline in expat numbers is due to the relocations of expats back to home countries and the decreasing expat arrivals amidst social tension in H2 2019 and the COVID-19 pandemic.
Further, shrinking housing budgets and the ongoing trend to switch from corporate lease to personal lease will continue to encourage tenants to opt for more economical options.
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