Residential sales volume to increase by 48% QoQ in Q2
The market is being driven by buyers looking for upgrading options.
Recovery is on the horizon for Hong Kong's residential market as its sales volume is expected to reach 14,900 in Q2, translating to a 47% QoQ jump, data from Cushman & Wakefield showed.
C&W said the number of deals first two months of Q2 of 10,099 has already exceeded Q1's of 10,056, and in June, transactions are expected to reach 4,800.
Based on the analyst's report, the residential market is being driven by primary sales, particularly for buyers looking for upgrading options. This situation will remain until the second half of the year, according to C&W.
The number of transactions in the primary market increased nearly six-fold m-o-m from 258 deals in April to 1,492 deals in May. The secondary market transactions also performed well and reached 4,700 deals in May.
The resumption of primary sales activities was mainly due to the relaxation of social distancing measures, said C&W.
"During the heights of the fifth pandemic wave, primary sales and projects were delayed due to restrictions. From March to April, primary transactions’ share of the overall market reached just 6-7%, but later rose to 24% in May, reflecting recovery in overall sentiment driven by the rebound of primary sales," Keith Chan, Director, Head of Research, Hong Kong, Cushman and Wakefield, said.
Meanwhile, C&W said property prices in Hong Kong will rise by no more than 3% this year.
"In the long run, infrastructure projects will continue to improve connectivity in Hong Kong, thereby narrowing the price gap between the New Territories and urban areas. This will also accelerate urban renewal and benefit the city’s residential real estate," the analyst added.