Dismal sales by Miami Quay shows Hong Kong’s home market is in a ‘depression’, expert says
- Only about 30 per cent, or 41 of the 137 flats on sale at Miami Quay in Kai Tak have been sold
- Besides a resurgence in Covid-19 infections, Hong Kong’s homeowners and potential buyers are also bracing for higher mortgage rates
Hong Kong’s housing market is in a “depression” according to one leading property expert, who pointed to poor sales at a prime new development in the city centre amid a backdrop of falling home prices, an interest rate upcycle and a new wave of Covid-19 infections.
“The market is panicking amid rising interest rates and the pandemic. So it’s been much quieter,” said Louis Chan, Asia-Pacific vice-chairman and chief executive of the residential division at Centaline Property Agency. “It is Hong Kong’s problem. The entire Hong Kong property market is in a depression.”
Chan cited a poor economic environment for his bleak outlook, which has pressured both the primary and secondary markets. Chan added that upcoming new launches would have to wait until the economy improves. “Whichever project launches [now] will fail,” said Chan.
Miami Quay caters mainly to middle-class buyers, who have been hit by the current economic downturn, said Chan. Currently, only projects with a lower price range of HK$3 million (US$382,220) to HK$5 million, similar to that of Home Ownership Scheme flats, will sell now, added Chan.
There is prevailing wait-and-see sentiment in the market, with heavy discounts required to facilitate transactions in the secondary market, said Sammy Po, CEO of Midland Realty’s residential division for Hong Kong and Macau.