Hong Kong's property market more prone to boom and bust: Roach

Staff reporter

Stephen Roach, the former Morgan Stanley Asia chairman and once seen as "China's good friend, yesterday tweeted that Hong Kong's property markets are more prone to boom-bust cycles than other regions.

Reposting a Financial Times story about the city's slumping property sector on X, formerly known as Twitter, Roach said that "This cycle is different" as Hong Kong is hit by "the China shock."

"Hardly immune to the post-Covid hangover afflicting others, HK is also being hit by "the China shock" - both economic and political," Roach noted.

Roach's latest comments came after he wrote in an FT column earlier this year that "it pains me to admit it, but Hong Kong is now over."

He argued that Hong Kong's embattled stock market symbolizes the end of its economic success over the past two decades, citing factors including Beijing's tightening grip and rising US-China tensions.

The city's benchmark index the Hang Seng Index had fallen below the 15,000 level to a 15-month low in January but it jumped over 20 percent to enter a technical bull market recently after China revealed a series of supportive measures to boost the local capital market.

Roach's earlier remarks caused heated discussions in the city, with government officials including Financial Secretary Paul Chan Mo-po pointedly disagreeing with his assessment.

Meanwhile, Hong Kong's primary market is so far maintaining its momentum which started following the removal of all housing curbs at the end of February.

CK Asset (1113) raised the prices of four three-bedroom units at Blue Coast, its new project atop Wong Chuk Hang MTR station, by 3 to 5 percent.

The developer said the price hike is believed to be moderate and the adjusted prices are still lower than the costs, adding that prices of the remaining units will also be adjusted in the near future.

Blue Coasts, co-developed by CKA and MTR Corp (0066), has sold 562 flats for over HK$10.6 billion so far.

Meanwhile, CKA's El Futuro in Kau To Shan recorded 11 deals so far this month, cashing in over HK$213 million.

In Kai Tak, China Overseas' (0688) One Victoria, however, saw nine deals canceled.