Hong Kong residential sales to hit up to 62,000 this year: Knight Frank

First-hand residential sales are currently booming. 

As the COVID situation and unemployment rate are improving, the housing market is booming, Knight Frank anticipates the residential supply, construction volume and completion volume are likely to meet the target this year. We believe the total residential sales will reach about 60,000-62,000 transactions this year. The supply of first-hand private residential flats for the coming 3-4 years is around 82,000, 12% lower than the government’s estimation of 93,000.

Knight Frank says the home prices are currently 2.2% down from the peak in 2019. Recently, the first-hand residential sales have been booming, reflecting that buyers' purchasing power remained. “We believe this good momentum will carry on and spread to the second-hand market. The property market performs better than our expectation, the home prices are expected to increase by 0 to 3%,” says Thomas Lam, Executive Director, Head of Valuation & Advisory.

As for the luxury property market, prime prices are less likely to be affected by the unemployment rate and affordability, hence price prices are expected to increase up to 5%. “Overall, we expect property prices ranged from 6 to 10 millions and super luxury homes to outperform. While the completion of nano flats will drop after 2022 which may be impacted by the recent relaxation to mortgage rules,” Lam adds.

Knight Frank estimates that the government's land sales revenue for the 2020/2021 fiscal year will be approximately HK$100 billion, a sharp rise of 40% from last year. Whether the target can be achieved would depend on the market responses to Central Harbourfront sites.