Morgan Stanley cuts home price forecast on slowdown

Staff reporter

Morgan Stanley cut the full-year Hong Kong home price growth projection from 10 percent to 8 percent as transactions and investment demand slow.

The bank noted that while Hong Kong residential prices have risen by approximately 7 percent since reaching a trough in December, a slowdown in the market is anticipated due to a decline in transaction volume and weak investment demand, suggesting that the upward trend may pause temporarily.

Morgan Stanley expresses a more optimistic outlook for the office market compared to that of the residential, saying office rents are reaching a bottoming point whereas the rebound in residential prices is expected to experience a slight slowdown.

In the secondary market, a two-bedroom unit at The Capitol in Lohas Park sold for HK$6.6 million, following the recent discovery of a load-bearing wall being knocked down in a flat there.

The apartment, measuring 519 square feet in size, was initially listed with an asking price of around HK$7.2 million.

According to Midland Realty, recent transaction prices for similar apartments in the area were around HK$7 million.

The original owner acquired the flat in March 2008 for HK$3.85 million and has held it for over 15 years, resulting in a profit of HK$2.75 million or a property appreciation exceeding 71 percent.

Meanwhile, a flat located in Island Garden, Shau Kei Wan, was recently sold at a price HK$2.76 million lower than its value six years ago.

The three-bedroom flat, spanning an area of 862 sq ft, was sold for HK$13.5 million, which is about 16 percent below the original asking price of around HK$16 million.

The previous owner acquired the flat in 2017 for HK$16.26 million and held it for six years before reselling it.

In the primary market, real estate developer Hip Shing Hong has named their project at No. 121 Shau Kei Wan Main Street East as "Oria." This development offers a total of 156 flats.

The sales brochure for Oria is expected to be uploaded soon, with the first batch due to be launched within this month.

Majestic Elite Property Development has announced the upcoming launch of tenders for five flats on Po Shan Road in Mid-Levels. The flats boast areas ranging from 2,098 to 2,206 sq ft.

The developer offers "occupation before completion" and "rent-to-own" plans for buyers.

Meanwhile, Sun Hung Kai Properties (0016) expects a 5 to 10 percent price increase for the upcoming releases of phase 2A of Novo Land in Tuen Mun.