Homebuyers were cautious amidst the prolonged social unrest in the country.
Residential sales volume dropped 44.7% MoM to 3,184 units in December, according to the Land Registry. This is said to be the lowest monthly sales volume figure in 2019.
Buyer sentiment continued to be subdued by the social unrest, according to a report by Knight Frank.
In addition, new homes sales for the whole year hit a 15-year high with a total of 21,108 unit transactions.
Although property prices were under pressure in H2 2019, favourable government policies, including a higher mortgage ceiling, assisted for the expansion of the sales volume of new homes during the year. The new mortgage ceiling resulted in a drop in nano unit demand, as buyers afford bigger homes.
Knight Frank sights that amidst the cautious outlook related to potential headwinds, many local developers were optimistic about the luxury residential market in the long run. Case in point is the recent sale of state-backed conglomerate CITIC Pacific, as they won the bid for luxury residential plot Tai Hang Road for an amount of $3.2b.
There are also several new projects launched in 2019 at attractive prices, such as Wetland Seasons Park in Tin Shui Wai and West Park in Cheung Sha Wan. Knight Frank expects new homes sales to rebound after late January, whilst landlords in the leasing market may continue to offer flexible terms such as short-term leases or rent-free ones to attract tenants in the upcoming season.
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