Unclear factors between Sino-US Friction is increasing. The market is expected to wait and see.
During the COVID-19 epidemic, the property market in Hong Kong has experienced a decline in trading over the past few months. Still, the decline in property prices has been relatively slight. The Rating and Valuation Department (RVD) announced yesterday that the latest property price index in April is 376 points, only a slight decrease of 0.13% monthly. The property prices have only fallen by 0.84% in the past four months. The property prices fell slightly during the epidemic. Still, the industry believes that it should not be taken lightly since it mainly reflects the actual market conditions in late March and early April. At the end of May to June, the local market is affected by Sino-US Friction. Uncertain factors emerged. The market outlook remains to be seen.
Journalist Ngan LunLok
The RVD announced yesterday that the private residential price index in April was 376 points, a slight decrease of 0.13% from 376.5 points in March. In summary, in the first four months of this year, property prices have fluctuated repeatedly with the severity and ease of the COVID-19 epidemic. Still, property prices have not fallen much during the period, only falling by 0.84%. The property prices fell 5.27% compared with the historical high of 396.9 points in May last year.
Ricacorp Properties expects political influence to escalate.
It is worth noting that the price index of April mainly reflects the actual market conditions in late March and early April. At that time, there were many cases among overseas returnees, causing a second wave of outbreaks. The implementation of the "Restriction of Gathering" since the end of March has frozen the market sentiment and caused the housing price index to be under pressure again.
The Research Department Director of Ricacorp Properties, ChenHoi-Chiu, also expresses that the local market is changing rapidly at the end of May to June. The National Security Law Related to Hong Kong Area will be implemented soon. The latest condition is affected by the political and economic climate, also further Sino-US Friction. The market is estimated to wait and see, and the property market trend needs to be further observed.
However, due to a certain lag in the property price index of RVD, the May index to be released next time will still only reflect the apparent improvement of the local epidemic after mid-April. At that time, both first-hand and second-hand property buyers were active, driving up the trading volume and prices. Therefore, the company expects the index of May to rebound by more than 1%.
Prices index for large units fell more obviously.
According to RVD data, property prices of all types of units recorded a decline in April. The declines were more pronounced in the larger units. Categories D and E units with 1,076 sq ft or more fell 0.68% monthly. On the other hand, the price indexes of small and medium-sized units in categories A to C dropped slightly, with an average decrease of 0.18%. Among them, the index for the smallest categories A units with an area of 430 sq ft Or below was newly reported at 416.4 points, down 0.38% monthly; Index for categories B of units in 431-752 sq ft fell 0.14%, and for categories C of units in 753-1,075 sq ft fell 0.09%.
The rent index fell 1.37%.
At the same time, the RVD released the latest private residential rent index for April, reporting 180 points, down from 182.5 points last month, down 1.37% monthly. Under the epidemic, the index fell 5.1% in the first four months of this year, and fell for eight consecutive months, representing 10%. The data shows that rents have fallen more than property prices in the past year.
Lau Ka-Fai, the Chief Analyst of Midland Real Estate, analyzes that the rent falling more is related to the current low-interest rate. Influential owners would prefer to rent out the unit with lower rent, but may not necessarily reduce the price to sell.
