Hong Kong Real Estate Market Decreasing By 40% To The Lowest In 26 Years

On January 5th, the Hong Kong Land Registry (LR) announced that 59,619 deals for the sale and purchase of real estates were submitted to the LR for registration in 2022, a 38% drop from the previous year and a 26-year record low since records began in 1996.

Among them, residential properties fell by nearly 40%. During the period, the total value of building sales and purchase agreements of about 554.5 billion Hong Kong Dollars (HKDs) (about 554.5 billion Hong Kong Dollars (HKDs) (about 71 billion US Dollar), a year-on-year decline of 39.6%, a new low since 2015; of which, 407.7 billion HKDs (about 407.7 billion HKDs (about 52.2 billion US Dollar) in residential sales and purchase agreements, a year-on-year decline of up to 44.4%, a new low since 2014; commercial real estate contracts fell 20% to 146.7 billion HKDs (about146.7billionHKDs(about18.8 billion US Dollar).

In 2022, Hong Kong real estate prices fell by 10%. Senior investors said that the main reason for the decline in the real estate market is the expected rise in interest rates, coupled with the three-year pandemic, buyers expressed concern about the future of the economy, the market shrunk, resulting in transaction prices being pushed down.

Looking ahead to the HK property market in 2023, the four major real estate developers in Hong Kong assessed that the rise ranged from 5% to 15%. However, the two major surveyor firms are bearish on the HK real estate market this year. Jones Lang LaSalle (JLL) Hong Kong expects that small and medium-sized residential property prices will fall by another 10% this year, and luxury properties will also fall by 5% to 10%. In addition, Evergrande’s Hong Kong headquarters, “China Evergrande Center”, was taken over last fall and put on the market for sale, at the valuation of 8 billion to8billionto 9 billion HKDs (just a little over 1 billion US Dollar), the bidding was suspended because the bidding did not meet the requirements.