(By Yan Lunle)
The Hong Kong government introduced a strict "Restriction of Gathering" to resist the continued COVID-19 epidemic, causing a halt of the activities of viewing houses in the property market and a decrease of the first-hand and second-hand property transactions. Four primary agents in Hong Kong had recorded the transaction volume of ten leading housing estates in the past two days between 3 and 12 cases, all lower than last weekend, with many housing estates recording of zero transactions. Industry insiders point out that the publics' desire to go out to view houses has dramatically reduced under the influence of the "restriction of gathering," and the trading has slowed further at the same time due to the less of cut-price houses. Thus, the trend of the second-hand property market depends on the development of the epidemic.
Cheap houses have been sold out.
According to Centaline Property statistics, it only recorded 7 transactions in ten leading housing estates in the past weekend, and Kingswood Villas among had the most transactions, with 4 cases. Mei Foo Sun Chuen, Laguna City, and Caribbean Coast each recorded 1 transaction, and up to 6 housing estates had zero transactions. The APAC Vice President and Residential Department President of Centaline Property, Chen Wing-Kit expresses that most citizens choose to stay at home to resist the epidemic under the "restriction of gathering." It sharply reduces the activities of viewing houses and affecting the pace of second-hand property trading. Besides, owners who are willing to largely cut the prices had expanded the negotiation in February and March, when the cheap houses had been sold out, and the cut-price houses have decreased. Thus, the trading slowed down further, and the second-hand property market trend depends on the development of the epidemic.
Midland branches only had recorded in ten leading housing estates in the past weekend with 12 transactions, which was 20% less than the 15 cases in the previous weekend. The Chief Executive of the Midland Real Estate Residential Department, Po Siu-Ming, points out that the market focuses on the second-hand property market again since there is no new supply of first-hand properties. He also expresses that the activities of viewing houses in the first and second-hand property market need to cooperate and be affected by the gathering restriction of above four-person due to the epidemic. However, Bu Shaoming is more optimistic about the market outlook and believes that there is still a rigid demand in the property market. Many buyers are still want to buy houses to store of value under the factors such as the US unlimited quantitative easing, interest rate cuts, and China's required reserve ratios cut. Also, individual owners sell their houses at a reduced price, which is popular. It is estimated that the first-hand property trading will focus on the inventory, and the purchasing power will continue to flow to the second-hand property market if there will not brand new large-scale projects being launched in April.
The transactions in ten leading housing estates recorded by Ricacorp Properties also dropped to 11 cases, a decrease of 3 cases or 27% weekly, and a new low of 8 weeks. The President of Ricacorp Properties, Liao Wai-Keung points out that the trading volumes will not rebound noticeably before the relief of the "Restriction of Gathering." Hong Kong Property Services had recorded in ten leading housing estates in the past two weekend days with 3 transactions, which was a further 25% drop from the 4 cases in the previous weekend and a successive down in five weeks.
The prices in Wai Wah Centre are the lowest of the year.
Many of the transactions recorded on the weekend days were price-cut transactions. The market source points out that low-rise Room A in the Block 1 of Sha Tin Wai Wah Centre, which is a two-bedroom unit in a usable area of 358 sq ft, had asked for HKD6.28 million in May last year, while was sold for HKD5.38 million recently. The accumulated price cut in one year has been HKD900,000 or 14%. The latest trading sq ft price is HKD15,028, which is a one-year low in this estate. It is understood that the original owner bought it for about HKD1.3 million in 2004. It has appreciated by about HKD4.08 million, an increase of 3.1 times.
The first-hand property market is still weak and dull as the second-hand property market. There are restrictions on the flow of people in first-hand property sales offices due to the restriction of gathering, slowing down the trading of the first-hand property. According to market information, there were only about 25 transactions in the past weekend days. And all are houses of inventory.
