Residential property deals surge to 9-year high as economy rebounds

Transactions rose 20% to 21,709 in the second quarter.

Residential property transactions in Hong Kong rose 20% to 21,709 in the second quarter of of 2021 compared to the same period last year, driven by Hong Kong’s economic recovery.

This brings the total residential transactions in the first half of the year to 39,840, the highest since 2012, Cushman & Wakefield reported.

“The housing market sentiment has turned warm with home prices in April rose by 4.1% year-on-year,” Keith Chan, Cushman & Wakefield’s Director, Head of Research, Hong Kong, said.

He attributed the improving sentiment to the economic rebound as seen in Hong Kong’s 7.9% YoY GDP growth after six months of contraction. On top of this, the joblessness in Hong Kong has likewise improved as the unemployment rate dropped to 6.4%.

Read also: Hong Kong GDP revised slightly up to 7.9%

“Residential transactions in the first four months of 2021 were dominated by secondary sales which took up 81%, up from 74% in 2020,” Chan said.

“This number has returned to the traditional secondary to primary sales ratio of 80 to 20%."

Overall, the total sales and purchase agreements stood at 18,590 in April and May. Transactions in June is estimated at around 9,500, bringing the total to 28,090 in the second quarter.

This reflected a 37% YoY and 20% QoQ increase.  

Moreover, Cushman & Wakefield noted that new home supply in the next two years will remain low at an average of 19,000 units per year. Meanwhile, home process are expected to increase by 5% for the remainder of the year.