Lower mortgage rates lifted home sales in Hong Kong to their highest point in five months in October, reversing a two-month decline, according to Land Registry data.
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A total of 4,697 new and lived-in homes with a cumulative sales value of about HK$37.3 billion (US$4.8 billion) changed hands in October, rising 65 per cent from 2,848 units and 79 per cent from a sales value of HK$20.8 billion in September, official data released on Monday showed. In the year-earlier period, 2,213 units changed hands, and the sales value was about HK$24.5 billion.
Meanwhile, overall property transactions – which includes office spaces, industrial units, retail shops and car parking spots – rose 52 per cent to 5,857 units from 3,843 in September. Sales value was around HK$41.7 billion. In the year-earlier period, there were 2,938 transactions.
Analysts said 2024 should be a better year for overall property sales than 2022 and 2023, thanks to expected interest rate cuts and Hong Kong’s efforts to improve its scheme to attract talent to the city. Unit sales were 59,619 in 2022 and 58,035 in 2023, the worst two years for property sales since 1997, when records began. They added that prices are expected to stabilise in the coming months and could rise next year.
“The [sales] volume does not yet reflect the market conditions following the policy address on October 16,” said Buggle Lau Ka-fai, chief analyst at Midland Realty, who predicted home sales would top 7,000 in November.
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In addition to cutting its benchmark rate last month, the Hong Kong Monetary Authority also eased its mortgage-financing requirements, raising the loan borrowing limit and increasing the debt servicing ratio to 50 per cent from 40 per cent for all properties.
“Given the strong sales in October, we believe overall residential transactions could reach 56,000 this year, higher than the 45,900 and 46,200 units in 2022 and 2023, respectively,” he said.