Hong Kong residential transactions drop 11.9% to 2,862 in September

Though there were sporadic big-ticket luxury sales during the month.

A Knight Frank report reveals that Hong Kong’s residential market remained downbeat under the prevailing economic conditions. Overall residential prices fell by another 1.4% MoM in August, down for the fourth consecutive month and further narrowing YTD growth to 1.3%, according to the Rating and Valuation Department (RVD). 

Here’s more from Knight Frank:

The total number of residential transactions shrank to 2,862 in September, down 11.9% MoM, according to the Land Registry. Primary sales transactions recorded a 27.5% MoM gain, stimulated by the launch of discounted first-hand sales units by developers. With purchasing power shifting to the primary market, secondary sales plunged by 24.2% MoM. 

Conversely, overall residential rents nudged higher with a 1.4% MoM increase in August, up for the seventh straight month, for 5.6% growth YTD. Class B units (saleable area of 40 sqm to 69.9 sqm) continued to outperform the market, with a 1.6% MoM increase according to the RVD. Demand was driven mainly by Mainland expatriates, whose focus is on one- to two-bedroom apartments in areas like Sai Ying Pun and Kennedy Town.

Sporadic big-ticket sales were recorded in the luxury segment amid market uncertainty. During the month, a 5,152-sq-ft low-floor unit in Opus Hong Kong in Mid-Levels East was sold for HK$418 million (or HK$81,134 per sq ft). Another 4,143-sq-ft high floor A unit at 23 Po Shan Road, Mid-Levels West, was sold for HK$270 million (or HK$65,170 per sq ft). 

Sales activity amongst market players, including homebuyers, landlords and developers, was muted throughout the month, as the public awaits the easing of stamp duty on home purchases in the 2023 Policy Address. Yet, under the high interest rate environment, it takes time to react after unveiling the partially ease market-cooling measures.