Hong Kong home prices fall for 5th straight month

October prices dropped 1.3 per cent in one of the world's least affordable property markets compared with a revised fall of 1.7 per cent in September.
October prices dropped 1.3 per cent in one of the world's least affordable property markets compared with a revised fall of 1.7 per cent in September.PHOTO: ST FILE

HONG KONG • Hong Kong private home prices slipped for a fifth consecutive month in October as the Asian financial hub grapples with its biggest political crisis in decades, although the pace of decline slowed.

October prices dropped 1.3 per cent in one of the world's least affordable property markets, compared with a revised fall of 1.7 per cent in September, government data showed on Friday.

"Looking at the social and market situation, the price index will continue to decline in November and December," said Mr Thomas Lam, executive director of property consultancy Knight Frank.

He added that low interest rates would provide some support.

The property sector has been relatively resilient compared with the tourism and retail sectors which have been hit badly by six months of often violent anti-government protests and the US-China trade dispute.

Hong Kong's home prices are still up 4.6 per cent so far this year.

Aiming to support first-time home buyers, the government last month relaxed rules, allowing them to borrow as much as 90 per cent of a home costing up to HK$8 million (S$1.4 million).

That relaxation of the mortgage cap for first-time buyers as well as a lending rate cut helped restore purchasing power in the housing market last month, Knight Frank said last week.

Knight Frank also expects a planned vacancy tax will prompt developers to dispose of unsold stock at attractive prices for the remainder of this year.

 
 

Realtor Centaline has estimated that sales in the secondary housing market last month will hit their highest level in six months, climbing 40 per cent more than in October.

Commercial property prices have also been disappointing for sellers.

Although an auction last week saw a record amount paid for a Hong Kong property site, it was at the lower end of estimates.

Sun Hung Kai Properties won the auction for a commercial site above the high-speed railway station that links the city to the mainland with its HK$42.2 billion bid.

Property surveyors had given a range of HK$38 billion to HK$79 billion.

A version of this article appeared in the print edition of The Straits Times on December 02, 2019, with the headline 'HK home prices fall for 5th straight month'. Print Edition | Subscribe