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Hong Kong non-public residence costs rise for second straight month in February

HONG KONG: Hong Kong non-public residence costs climbed 2.2 per cent in February, the second straight month-to-month improve, helped by bettering sentiment after the border with China was reopened, expectations that rates of interest are peaking, and a spate of recent undertaking launches.

The rise in residence costs in February adopted a revised 1 per cent acquire in January and was the most important since Could 2020, official information confirmed on Wednesday (Mar 29).

The monetary hub this month was ranked by survey firm Demographia because the least reasonably priced metropolis on the planet in 2022 primarily based on property costs versus median revenue, with Sydney and Vancouver trailing behind. This was the 13th consecutive yr that Hong Kong topped the rating.

“Hong Kong has been given a transparent accountability by the central authorities to enhance housing affordability, and improve home sizes,” Demographia stated in its report final week.

Beijing recognized unaffordable housing as a key reason for discontent within the former British colony, particularly among the many metropolis’s youth, and a driving issue within the typically violent anti-government protests of 2019.

Some analysts have raised their 2023 forecasts for housing costs within the metropolis over the previous few weeks, anticipating a reversal after residence costs fell by about 15 per cent final yr.

The autumn in 2022 was the primary annual drop since 2008, with the property market dragged down by a weak financial outlook, rising mortgage prices and a COVID-19 outbreak originally of the yr.

JP Morgan analyst Cusson Leung stated he expects a 10 per cent to 15 per cent rise this yr, pushed by a slowing tempo in rate of interest hikes, a stronger financial system and elevated purchases by non-locals.

“The numerous choose up in high-end residential transactions is a powerful vote of shopping for confidence within the Hong Kong housing market,” Leung stated in a report.

Latest main housing initiatives additionally recorded sturdy buy charges at their launches, Leung stated.

Realtor Cushman & Wakefield anticipated residence costs to rise 5 per cent to 10 per cent for the complete yr, revising its earlier forecast of a flat market to a 5 per cent drop, and stated transaction volumes would rebound 25 per cent to 35 per cent.

Cushman & Wakefield stated the reopening of borders and the federal government’s latest transfer to decrease stamp duties for first-time residence patrons of small- to mid-sized residences have prompted extra purchases within the residential market.

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