Property News · January 5, 2017

Why secondary home sales in Hong Kong are feeling the chill


While the primary market is simmering
Crowds gather at 1881 Heritage, the former Marine Police Headquarters, in Hong Kong. Zen S Prarom / Shutterstock.com
Winter has come to Hong Kong.
While new home sales in the Chinese SAR hit hot new highs price-wise, secondary market sales plummeted last year to their lowest levels yet since 1996, the South China Morning Post reported, citing data released Wednesday by the Land Registry.
There were only 40,466 units in second-hand home sales for 2016, a 1 percent year-on-year drop that totalled HKD241.5 billion (USD31 billion) in value. In contrast, primary market sales increased 16 percent to HKD188.4 billion (USD24.3 billion) last year, the highest value recorded by the registry since 1995.
Such polar performances come two months after the Hong Kong government levied a series of cooling measures on home buyers, including a 15 percent stamp duty on all second-time residential purchases.
More: How these billionaires dodged Hong Kong’s new property curbs
The uptick in primary home prices can be attributed to an increase in the number of cash-rich buyers snapping up super-deluxe apartments in Q4, Derek Chan, head of research at Ricacrop Properties, explained to the South China Morning Post.
Remarkably, the number of transactions in the primary sector in 2016 amounted to 16,796, a 0.02 percent fall from 2015. In fact, the number of contracts transacted for all Hong Kong properties, including apartments, shops, industrial units and car parks, fell 4.1 percent between 2015 and 2016 to 73,004 units, representing HKD532.9 billion (USD68.7 billion) in sales.
Figures for December alone saw a 47.3 percent month-on-month decline in home sales to 3,550 units or a 46.7 percent decline in value to HKD32.86 billion (USD4.2 billion).
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Source : property-report.com
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