Q & A on Hong Kong Property market

Q & A on Hong Kong Property market
 
 

In the view of government’s determination to significantly increase the supply of small-to-medium-sized units by providing more land for sale, together with restriction on size and number of units, resuming the Homeownership Scheme (HOS) as well as introducing the My Home Purchasing Plan (MHPP), the future supply is expected to increase. All such measures should be able to help the low income group to enter the market.

We expect more primary units will be launched this year because developers are able to replenish their land bank much faster in the past two years. We also expect the government will continue to offer more land for sell on a quarterly basis this year. And because of that, developers are more willing to offer their units for sale.

It is estimated that the proportion of mainland buyers accounted for approximately 20% of the property market in terms of transaction value last year. Mainland buyers are keen on buying primary units, it is estimated that mainland buyers accounted for approximately 40% of the transaction value in primary market compared to only 13% in the secondary market.

Tightening of credits would slow down the upgraders’ market, especially for the mid-to-high-end properties. The upgraders’ market is an integral part of overall HK property market, therefore loosening the credits appropriately is important for a healthy market to develop.

The low interest rate environment began in 2009 and lasted till now, and the government has launched many measures to discourage market speculations. If there were a housing bubble, the government would probably come up with new measures.