Deals remain dull as agents batten down

The number of deals at 10 major housing estates in Hong Kong rose to seven over the weekend but still remained in the single digits, as two major property agencies said they are planning further cutbacks amid a weak market.

Centaline Property Agency reported seven transactions in 10 blue-chip estates, compared to none a week ago, with buyers expecting the government to scrap the property cooling measures in the upcoming budget.

Midland Realty too posted seven deals, with the number stuck in the single digits for the fifth consecutive week.

This came as Centaline and Midland, two major real estate agencies in Hong Kong, revealed plans to downsize amid a weak market.

Hong Kong's economy and the property market are facing structural changes, said Louis Chan Wing-kit, the Asia-Pacific vice-chairman of the residential division at Centaline, adding that the agency is planning to close about 20 percent of its branches this year and may also see its staff numbers decline by 400 to 500, Chan said.

Although the rental market has become more prosperous, it only accounts for about 20 percent of Centaline's business and cannot fully compensate for the decline in residential transactions, Chan said.

He added that transactions in the local property market may return to normal levels only after the US starts to cut interest rates.

Hong Kong private home prices dropped 6.8 percent last year, a second year of decline, as high interest rates and the slowing economy continue to weigh on sentiments.

Midland Holdings (1200) chairman Freddie Wong Kin-yip meanwhile said the group has been downsizing due to market conditions, closing about 140 branches and losing over 1,700 employees in 2023.

He said the company may further shrink its business if the economy continues to deteriorate.

In the primary market, Sino Land (0083) is planning to launch four new projects this year, offering a total of 1,961 flats.

Among them, One Central Place in Central, which will provide 121 flats, is expected to launch sales in the first quarter.

In the commercial market, the number of new shop registrations dropped 15.4 percent month-on-month to 66 last month, according to Midland IC&I.

In other news, a three-story house at 15 Moorsom Road, Jardine's Lookout, saw its indicative price reduced by 17 percent to HK$190 million, according to Savills.