Hong Kong’s 10 biggest residential estates saw transactions rise to the highest in three years last weekend, according to Centaline Property Agency, as the market continued to benefit from recent easing steps.
A total of 37 apartments changed hands on the weekend, up 48% from a week earlier. Hong Kong property buyers have been rushing to snap up homes after the government removed extra property levies last month to boost the market.
Shares of Hong Kong’s biggest developers rose on Monday morning as the figures spurred optimism that the relaxation of cooling measures will continue to stimulate housing demand.
Still, analysts at S&P Global Ratings expect home values will remain weighed down by high interest rates and ample supply. UBS Group AG estimates prices will decline by 5% in 2024, despite the policy change.
Secondary home prices in the week ended March 3, which included four days after the lifting of the curbs on Feb. 28, fell 0.8% from a week earlier, the latest Centaline data show.
For now, investors are welcoming the pickup in demand. New World Development’s shares rose as much as 2.8% on Monday morning in Hong Kong. Henderson Land Development gained 2.3%, while Sun Hung Kai Properties climbed more than 1%.
Last month’s easing means foreign buyers and existing-home owners no longer have to pay higher taxes on transactions. Instead, everyone is subject to the regular rate capped at 4.25%. In addition, mortgage rules were loosened to allow some homebuyers to purchase properties with smaller down payments.
Hong Kong’s new-home sales surged 10 times in the first five days after the government removed the cooling measures compared with two months ago, according to Midland Realty. Henderson Land’s latest housing project also benefited from the tax cuts. The developer sold almost 200 apartments in a few hours on Thursday after applications were oversubscribed by 34 times.
