Sales of hong kong property dip but prices stay steady

The volume of residential property transactions fell in the first six months of 2013 by 32.1 per cent compared to the same period in 2012. Sales fell to a low in April, the Land Registry revealed, with only 3,427 transactions registered.

The fall in activity follows the introduction of Double Stamp Duty in February and the enforcement of Residential Properties Ordinance in April, which orders sellers to regularly update marketing materials. Since the latter came into effect, fewer than 500 units have been placed on the market.

This slowdown is only expected to be temporary by Knight Franks, as developers bring projects back onto the market with modified marketing materials to comply with the new regulations.

Prices, meanwhile, have stayed steady, showing no sign of significant decline. Luxury prices, according to Knight Frank, dipped 2.2 per cent in April but have “since remained stable”.

“Long-term investors and foreign buyers have been staying away from the market, which is now dominated by first-time buyers and end-users,” continues Knight Frank. “We expect this smaller customer pool will result in residential sales finishing the year 10% lower than in 2012. Mainstream property prices are expected to fall around 10% over the course of 2013, while prices in the more resilient luxury sector will fall 5%.”