Home prices slip after two months of gains

Private residential prices in Hong Kong dipped 0.5 percent month-on-month in July after climbing for consecutive two months, data from the Rating and Valuation Department showed, as Knight Frank forecast that home prices will drop about 5 percent this year.

But rents for private home units overall increased for two months on the trot, rising 0.6 percent month-on-month in July, the department said.

Buggle Lau, chief analyst of Midland Realty, forecast private residential prices would fall by up to 1 percent in August as the impact of the pandemic was not fully reflected in the July gauge.

And William Kwok Tze-wai, a director of Cheung Kong Real Estate, also said home prices are under pressure in the short term.

Meanwhile, the number of mortgage applications in July decreased month-on-month by 4.2 percent to 13,246, said the Hong Kong Monetary Authority.

Separately, property buyers backed out of 30 home purchase deals at major new projects in August, media reported.

A buyer forfeited deposits of about HK$220,000 after cancelling the purchase of a 227-sq-ft flat at Emerald Bay in Tuen Mun, which was offered at HK$4.33 million.

Also in the district, Empire Group and Hong Kong Ferry (0050) has collected HK$2.7 billion after selling 570 out of 611 units at their Seacoast Royale project.

In the secondary market, Centaline Property Agency recorded only 250 secondary transactions at 10 blue-chip housing estates in August, down by 2.3 percent from July and hitting a six-month low.

In the commercial market, Hang Seng Bank (0011) slashed rents for three street shop premises at Hang Seng Tsimshatsui Building, media reported. Among them, a 1,072-sq-ft shop was leased for HK$200,000, or HK$186 per sq ft, after HK$190,000, or 48.7 percent, was slashed from the original asking rent.

In Sheung Wan, a 1,057-sq-ft room at Shun Tak Centre China Merchants Tower was rented for HK$30,600 per month, or HK$29 per sq ft, the lowest in almost a decade at the building, reports said.