2,800 new flats are poised to launch in Hong Kong as developers await interest rate cuts
- Property agents predict September sales may quadruple from August’s level if the Fed embarks on policy easing as expected
Centaline Property Agency forecasts that September will see as many as 2,000 first-hand home transactions, four times more than the 500 deals expected this month, if the rate cut comes through.
“If indeed the US Fed cuts the interest rate in September, we believe that more projects will launch,” said Louis Chan, the agency’s vice-chairman and CEO for residential property in Asia-Pacific.
Fed chairman Jerome Powell gave the strongest hint of a reduction in rates, which are at a 23-year high, during a speech on Friday, though he did not specify the timing. Observers widely believe that the easing will begin after the Fed meets on September 17 and 18.
Hong Kong’s monetary authority has moved interest rates in lockstep with the Fed to maintain the local currency’s peg to the US dollar, raising rates on 11 occasions between March 2022 and July 2023.
“It is believed that if the rate cut is officially implemented in September, it would eliminate uncertainties in the property market, leading to an acceleration in the sales of first-hand properties, thus stimulating the release of accumulated purchasing power and contributing to overall market transactions,” said Sammy Po Siu-ming, CEO of Midland Realty’s residential division.
New projects ready for launch include Cullinan Sky Phase 1 by Sun Hung Kai Properties (SHKP) and Twin Victoria by China Overseas Land, both in Kai Tak; SHKP’s Yoho Hub II and Lai Sun Development’s The Parkland in Yuen Long; SHKP’s Victoria Harbour II in North Point; CK Asset’s Blue Coast Phase 3C in Wong Chuk Hang; and Henderson Land’s Parkwood in Tai Po.
