Homebuyers getting cold feet in Hong Kong’s property market amid growing uncertainties
Buyers are starting to have second thoughts on flats, which some analysts say could signal a turn of sentiment in a market that has become used to ever-rising prices, cheap loans and stiff competition for tight supply
Some buyers are so edgy about the Hong Kong property market that they are pulling out of deals, despite losing big deposits.
A buyer who agreed to buy a unit at Sun Hung Kai Properties’ St Martin II two weeks ago cancelled the purchase on Thursday. The U-turn on the HK$7.25 million studio unit in Tai Po in the New Territories meant the buyer had to forfeit the 5 per cent deposit – about HK$362,700 (US$46,200).
That followed five instances on Wednesday at Sun Hung Kai’s Park Yoho Milano in the northern Yuen Long district. A total of nearly HK$2 million will be charged for the sales terminations. The project debuted last month and was seen as the cheapest residential project this year.
The reversals come amid growing uncertainty in the home property market.
Buyers are starting to have second thoughts on flats, which some analysts say could be a signal of a meaningful turn of sentiment in a market that has become used to ever-growing prices, cheap loans and stiff competition for tight supply.
A gloomy outlook appears to be settling in as banks raise mortgage rates, the US-China trade war brings uncertainties, stock markets struggle and Hong Kong government measures to cool prices start to bite.
“Seeing some developers tag their new flats at a less aggressive level or even lower down the prices, buyers are expecting more cheaper new flats to be put onto the market soon,” said Vincent Cheung Kiu-cho, deputy managing director for Asia valuation and advisory services at Colliers International. “The sentiment will last at least a quarter.”
