HONG KONG: Hong Kong’s private home prices, among the world’s least affordable, climbed to their highest level since July 2019 in March, official data showed on Wednesday, supported by robust demand and a recovering economy.

The prices gained for the third month in a row in March, rising 0.8%, according to the data, compared with a revised 0.86% increase in February.

The March price index stood at 388.3, 2.2% lower than the historical high of 396.9 in May 2019.

Hong Kong’s residential property market, which has a serious supply shortage, remained resilient last year, despite the pandemic and sometimes violent anti-government protests that started in the summer of 2019.

A report from think-tanks Urban Reform Institute and Frontier Centre for Public Policy ranked Hong Kong the world’s least affordable housing market for the 11th straight year in 2020, based on median property prices and household incomes.

Property agent Centaline said transaction volumes in the secondary market in April were expected to be the highest in eight years with values at a 23-year high.

Sentiment in the market started improving early this year thanks to new vaccines, and buyers expect home prices could pick up after borders reopen with mainland China.

Mainland Chinese bought 40% more residential properties in Hong Kong in the first two months of 2021 than a year ago, according to realtor Midland.

More than 80% of their 2021 purchases were valued above HK$50 million ($6.4 million), Midland said.

But some property agents said high unemployment would weigh on the market in the mid-term.

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