American League: Hong Kong property prices are expected to stop falling and stabilize in the fourth quarter, and the annual decline will narrow to within 5%

The Zhitong Finance App learned that Hong Kong's 2024 “Policy Address” announced that residential mortgages will be relaxed to 70% regardless of personal use or investment, and that investors will be allowed to purchase residential properties. Bu Shaoming, CEO of the Housing Department of Midland Properties, said that the “Policy Address” has had a profound impact on the Hong Kong property market. The various measures reconfirm the role of residential properties in addition to self-occupation, and also to attract capital to settle in Hong Kong. He believes that the new measures will help promote property transactions, thereby narrowing and stopping the decline in property prices. It is expected that property prices will rise by about 3% in the fourth quarter, and the annual decline will be within 5%.

Bu Shaoming pointed out that the “Policy Address” suggests that the maximum mortgage ratio for investing in residential properties has been raised from 60% to 70%, which is believed to help attract investment demand into the market. In particular, the current property prices have been drastically reduced from the peak period. In line with the start of the interest rate reduction cycle, rents continue to rise, making the return on rent attractive. The “flat rent” situation of many housing estates has returned, and in addition, measures introduced by the central government have boosted the economy. Driven by many favorable factors, it is estimated that first-hand transactions are expected to rise to 5,000 in the fourth quarter, surging by more than 1.1 times quarterly and hitting a new high of 22 quarters (5 and a half years); in the second-hand sector, 10,000 cases are expected to be recorded in the fourth quarter, up nearly 20% from quarter to quarter.