14.1 C
New York
Friday, March 24, 2023

Hong Kong home prices rise for first time in six months

Hong Kong home prices rise for first time in six months© Reuters. High rise private residential buildings are seen in Hong Kong

HONG KONG (Reuters) – Hong Kong private home prices posted their first monthly on month rise in six months in January, as sales rebounded in one of the world’s least affordable property markets.

Prices rose 0.1 percent from a month ago in January, government data showed, compared with December’s revised 2.3 percent decline.

Thomas Lam, executive director of Knight Frank, said while the data showed prices stabilizing, a sustained recovery was unlikely.

“Now the market is relatively stable, I forecast the index will rise another 0.5 percent in February,” Lam said.

“I expect the property will continue to correct this year.”

Knight Frank maintains its full year forecast for a 10 percent decline this year with vulnerability seen in the so-called “nano flat” sector.

Over the past decade, ultra low interest rates, limited housing supply and large capital flows from mainland Chinese buyers helped push housing prices up more than 200 percent. That bubble was burst in the middle of last year and prices have since come off 9 percent.

A continued correction could lead to more cases of negative equity on residential mortgage loans, which resurfaced for the first time in two years in the last quarter of 2018.

Affordability is still an issue. A flat of 60 square meters (646 square ft) on Hong Kong Island cost an average of HK$10.14 million ($1.29 million) in January, according to official data.

On Wednesday, Hong Kong Financial Secretary Paul Chan said in the budget for the upcoming fiscal year that estimated public housing production for the next 5 years is 100,400 units, while private sector will complete 18,800 units annually, up 20 percent from the past 5 years.

He added the government has no intention to withdraw any demand-side management measures at this stage, which includes extra stamp duty, as home prices are still above people’s affordability levels.

Leading developer Sun Hung Kai Properties said an easing of tensions between Beijing and Washington and banks’ favorable mortgage plans would support the housing market.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.

Source: Investing.com

Related Articles

Stay Connected

- Advertisement -

Latest Articles

Popular Articles