Hong Kong real estate actually had a good year in 2018. Transactions worth a whopping HK$403.7 billion or roughly US$51.5 billion were witnessed in the first half of the year although there was a cooling effect seen in the market from August 2018 till December 2018. For 2018, 79, 185 property deals were executed in Hong Kong worth a cumulative HK$729.56 billion. This makes 2018 the second best performing year for the Hong Kong real estate market. The record was set at HK$868 billion witnessed in the year 1997.
Prices still remain considerably high and this has led to record values of property in Hong Kong. As per reports, all property transactions in December 2018 touched 3, 024 which is de-growth of 23.5% as compared to November 2018. However, the high property sales overall have made 2018 a considerably good year for the Hong Kong realty market.
As per estimates, close to 50, 000 residential units are expected to be sold next year which is about 10% lower as compared to 2018. Around 15, 800 new flats are also expected to be purchased which is however de-growth of only 5%. As a result, the Hong Kong real estate market will be relatively stable in terms of pricing and transactions and hence it will keep witnessing some growth. Experts estimate that the number of homes which are ready to sell will go up with close to 17, 000 units estimated to be ready for selling in New Territories. This may lead to sales prices coming down a little, thereby encouraging buyer interest in the realty market.
China Overseas Land and Investment has already kicked off things with The Regent project comprising of 1, 620 units. Prices will come down more whenever there are more units available. Tai Po may be another competitive market for real estate developers. The Central Horizon project by Billion Development and Project Management will be selling 1, 408 units in this area while another 723 units will be available at Ontolo by Great Eagle Holdings and Sino Land. 528 units will be offered at Mayfair by the Sea as well. There should be housing units available in the zone which come at roughly HK$15, 000 per square foot. Prices may come down by roughly 16.7% which may lead to more buyers picking up properties in Hong Kong.
Home prices have already reduced by 7.2% after hitting their peak in July 2018 post a surge over 28 months. Commercial real estate transactions are also expected to grow in Hong Kong which will spur growth in the residential real estate space.