Many sellers hold back on buying new homes

Top News | Stella Wong 8 Dec 2017

About 360,000 people have failed to buy another flat after selling their unit, missing the skyrocketing wave of housing prices, a bank survey found.

Citibank commissioned the Hong Kong University Social Sciences Research Centre to interview more than 500 people this quarter about their willingness to buy assets.

The survey showed that 610,000 people have sold their properties in the past 10 years, and 250,000 have immediately bought a new one. The other 360,000 did not.

Among them, 200,000 are not flat owners now.

The survey showed that about 55 percent of interviewees believe housing prices will rise next year - an 11 percent increase from last year's survey. Only 11 percent thought prices will fall, which is a decrease from 21 percent last year.

However, expectations do not greatly affect their willingness to buy flats.

About 21 percent showed interest in buying flats in the third quarter this year, which was 7 percent higher than the second quarter. However, it was lower than the 23 percent in the first quarter.

More than one-third of those between 21 and 29 said there was a need to buy a flat, which was the highest among the age groups.

However, more than 50 percent of the people in that age group believe they would not be able to buy a flat in the next 10 years.

Meanwhile, 66 percent of males in the same age group felt they needed to own a flat in order to get married, while 45 percent of females had the same mindset.

Head of Citibank retail banking Lawrence Lam Chi-kong said young people's willingness to buy flats is affected by what they have been told.

"People around them may tell them it is difficult to buy a flat now. They would say 'if you want to buy a flat, you better hurry up,'" Lam said.

For next year's property prices, Citibank forecasts a rise in the first half but the degree of the increase will be less than this year. For the second half of the year, prices will lose momentum.

"We have learned from the past that after rising for a few years, the property price will take a rest," Lam said.

Lam also said Citibank expects the United States to lift interest rates. It is unclear whether mortgage rates will be impacted. Lam urged Hongkongers to keep a close eye on the situation.

stellast.wong@singtaonewscorp.com

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