Official data indicates that dragged down by continuous interest rate hikes in developed economies, a weakening Chinese economy, and a sluggish real estate market, private residential property prices in Hong Kong dropped by 1.12% month-over-month in July, marking the third consecutive month of decline. Additionally, the revised figures show private residential property prices fell by 1.05% in June.
At the beginning of this year, private residential property prices in Hong Kong had bounced back from a 15% drop in 2022, but they began to decline again after May due to several negative factors. Henderson Land, a real estate developer, mentioned in its earnings report last week that the downward trend in second-hand market prices has become very evident. If the government does not introduce support measures for the real estate market, the market in the second half of the year will be "quite sluggish".
Despite the market participants’ continuous calls for the government to ease restrictions on the real estate market to stimulate the market during this sluggish period, the Hong Kong government has repeatedly stated that it is not the right time for further adjustments due to factors like housing shortage and still high property prices.
CK Asset, a major developer owned by Li Ka-shing, shocked the market this month by launching a new project at the lowest price in seven years, potentially triggering a price war in the real estate market of this financial hub, Hong Kong.
Centaline Property Agency expects that transaction volumes in Hong Kong will continue to fall to a new low of eight months in August, indicating that the Hong Kong real estate market is facing numerous challenges.
