Strong sales unlikely to stem home price decline: JLL

Monthly sales need to hit 5,700 transactions to prop up slowing prices.

The strong sales witnessed by a number of recent residential projects is unlikely to reverse the downward trend in Hong Kong residential property prices, according to a report from JLL. 

Also read: Hong Kong's home price war heats up as developers rush to unload stock

Sales need to be sustained above 5,700 transactions per month to be able to see price gains but the threshold has fallen to about 4,200 monthly transactions in recent years. 

Also read: Property deals down 5.5% to 79,193 in 2018

"With the recent flurry of sales being underpinned by heavy discounting in the primary market, attempts to raise prices will quickly thwart any hint of a market recovery," Denis Ma of JLL said in a report.

Sun Hung Kai Properties and China Overseas Property were amongst the big-ticket property developers who have been turning to discounts during their recent launches in a bid to prop up struggling bottomlines. 

As the US-China trade dispute festers, the property market will continue to witness the outflow of Chinese capital as sentiment sours. "With a quick resolution unlikely, we maintain our view for housing prices to continue their slide in 2019 and fall a further 10-15% after slipping 4.2% from their peak in 2018," he added.