Sales of existing homes fell in August, as new mass-market projects tempted buyers. The total number of transactions fell by 14.5% month-on-month.
In the new homes market activity started to pick up, with more mass-market projects becoming available for sale or in the pipeline, according to Knight Frank’s recently-released Hong Kong Monthly Market Update.
With various cooling policies in place and market sentiment remaining cautious, we believe there will be a drop in activity in both the new-build and resale markets over the remainder of the year. In 2013, the total number of residential sales is expected to fall about 20%, with mass residential prices dropping less than 5% and prices in the more resilient luxury sector falling less than 3% in the rest of the year.
On the leasing front, there was a shift in demand from ‘super luxury’ to ‘mid-range luxury’ units, probably due to the lowering of accommodation allowances for staff in the finance sector and greater cost-awareness among tenants, of them many were shifting to personal leases.
The leasing market was less active, despite it being the traditional peak summer season. Luxury residential rents dropped 2.7% in August, the biggest dip since August 2009.
Follow this link for the full Hong Kong Monthly Market Update.