Developers From Hong Kong En Route To Flooding Property Market With 9,000 Units

Hong Kong's property market will receive around 9,000 homes in the second quarter despite positive sentiments. According to SCMP, developers have waited their turn in releasing units into the market despite the prevailing mood among buyers. They expect the competition to be 'fierce' once they start introducing promotions, such as discounts, to open the market to interested buyers.

Homes are likely to flood the market, assuming that developers will be quick to notice that rising prices equate to more profit. However, analysts are looking at a more modest forecast. They expect the market to stay the same as increases are toned down, while builders instead focus on promoting discounts.

Derek Chan of Ricacorp Properties shared his analysis, saying that developers are expected to create plans to step into the void created by the recovering appetite. He continued to say that buyers and the fierce competition are bound to make developers put pricing that will be affordable to the market at large as compared to higher prices.

The Investor reported that more land equates to more unused properties. Developers say that they haven't hoarded apartment units, adding that the reason behind it is because of an 'increase of land supply.' It is a sad thing to watch, considering that there are already unsold properties combined with an 'acute housing shortage' in the city.

The government has already declared unveiling a vacancy tax which will exact a certain amount from property owners caught hoarding the sand flats, their own answer to easing the housing shortage. There is ample evidence of a number of houses--about 9,000 of them--which are being held by developers.

Hong Kong has consistently ranked among the world's most expensive property hubs. The government, meanwhile, is already in the process of conducting a consultation with the public in terms of securing more land. This is to create a back-up to the predicted land shortage amounting to about 1,200 hectares.

Hong Kong's price increase amid the shortage of land and properties is the priority of the government. Home prices have risen to 1.6 percent in the first months of the year, from already dropping by 9.2 percent from August to December. Buyers have already tried purchasing property then, but the lingering fears from world issues have created the rise in prices that have buyers backpedaling.

© 2019 Business Times All rights reserved. Do not reproduce without permission.
Sign Up for Newsletters and Alerts