Hong Kong residential transactions surge 56% to 6,690 units in March
The primary market also had a positive performance.
The residential market sentiment in Hong Kong was strong in March, and Knight Frank said sales activity bounced back given the improved local economy. According to the Land Registry, a total of 6,690 transactions were recorded in March, surging 56.2% MoM.
The latest official data shows that overall residential home prices in February increased 2.2% MoM. The figure rose for two consecutive months, reaching a four-month high.
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The primary market heated up again, with a 172.8% MoM increase to 1,787 transactions, supported mainly by brisk sales of newly launched projects. For instance, KOKO MARE in Lam Tin, by Wheelock Properties, received over 2,400 tickets for its second batch of sales, representing an oversubscription of about 23 times, showing buyers’ confidence in the residential market.
The luxury segment has proven resilient, as the interest rate hikes do not put much pressure on luxury market buyers. However, some of the potential buyers were still price conservative, leading to a slow recovery in transaction volume. Major transactions included a unit in Central Peak in Mid-Levels East, which was sold for HK$177 million, or HK$85,096 per sq ft; and a 2,316-sq-ft unit at 21 Borrett Road in Mid-Levels Central, which was sold for HK$152.8 million, or HK$65,976 per sq ft.
According to the Inland Revenue Department, Hong Kong’s overall stamp duty revenue from home sales rose 44% MoM to HK$800 million in March, the highest in 10 months. Driven by the border reopening and increasing purchase demand from nonlocal buyers, cases involving Buyer’s Stamp Duty (BSD) surged 50.8% MoM to 92, the highest number of cases since January 2022.
The overall home rental index in February ended a five-month decreasing trend. Enquiries and home viewing activity continued during the month, but leasing activity has been relatively quiet since the recent peak. Notable transactions included a unit at 21 Borrett Road in Mid-Levels Central, which was rented for HK$190,000 per month, or HK$91 per sq ft.
With interest rate hikes expected to peak in Hong Kong, this will benefit primary market sales. Coupled with the border reopening with the Chinese mainland and an economic recovery, this will boost investor confidence and local home demand in the near term. However, the high volume of unsold new units will continue to put pressure on sales prices, in both the primary and secondary markets.