No Woes. It’s a Robust Hong Kong Luxury Real-Estate Market.

  • 8 years ago

While Hong Kong’s luxury segment is poised to remain stable, according to a market report released Wednesday, residential sales are expected to decrease overall in December due to the impact of the double stamp duty and other seasonal factors.
The changes noted in December’s forecast were not altogether unexpected, considering the cooling measures the government imposed in early November. Knight Frank’s monthly health check of the Hong Kong real estate market, concluded the Land Registry’s December data is likely to begin showing the impact of the newly adopted stamp duty.

Foreigners and non-Hong Kong permanent residents long since been subject to a 15% stamp duty, a standard set in place in 2012. November marked the first time that all, except first-time local buyers, are subject to a 15% standardized stamp duty. This increase nearly doubles the 8.5% rate imposed in February 2013, which doubled the previous stamp duty of 4.5%.

In the report, Pamela Tsui, senior manager of Research & Consultancy for Greater China at Knight Frank said, “However, we believe that luxury residential sales remained stable as shown by the conclusion of some super luxury deals in the month.” According to the report, two connected apartments in Mount Nicholson on the Peak became the third most expensive apartments in Hong Kong, after selling in November for HK$912 million (US$117.6 million), or HK$104,803 (US$13,513) per square foot.

According to Land Registry data published earlier this month, November boasted robust residential sales with increases of 138.5% year-over-year to 6,739 units, up 2.1% since October. According to Tsui, “November’s sales data increased compared with October’s despite the government’s stamp duty rate rising to 15% to suppress price growth, mainly because the figures reflect transactions in the previous weeks.”

Predicting a decline in residential sales prices in the near future, Tsui said, “We do not expect a mild U.S. interest-rate rise to dampen the local residential market, but abundant supply, as well as economic and policy uncertainties, may drag down mass residential prices by about 5% next year,” she said.”

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