Civil unrest stalling Hong Kong�s housing market over the coming year

RICS-Spacious report indicates continuous decline in prices, sales volumes and rents

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HONG KONG, CHINA – Media OutReach
– 19 September 2019 – Amidst trade tensions
between China and the U.S., Hong Kong’s political unrest has continued to
dampen market sentiment. According to the newly published RICS-Spacious Hong
Kong Residential Market Survey, Confidence Index continues to fall from -54 in
July to -76 in August.

 

The survey also indicates that both buyer and
rental demands have reported significant deterioration, with rental demand recording
its first negative reading in the survey’s history.

 

During the most intense period of protests,
nearly 70% of respondents have cited some degree of price decline over the past
three months. Prices, sales volumes and rents are expected to dwindle in the
near-term.

 

Aggregate prices are expected to fall 4.6%
across Hong Kong, sales volumes are seen slipping 5.3% and rents 2.5%. The
market outlook prediction seems to be a significant reversal since June, where
survey contributors anticipated an increase on all three of these metrics.

 

“Participants also commented that a cessation
of the protests appears to be unlikely in the near-term, which contributed to
the more subdued medium-term outlook for the market”, said the report’s author
Sean Ellison, RICS Senior Economist for Asia-Pacific. Ellison also states that
“some survey respondents cited tariff escalation between China and the U.S. as
a headwind, the ongoing political unrest continues to be the main catalyst
cited as driving market pessimism.”

 

Although the current market sentiment is
similar to when trade tensions escalated and when interest rates were expected
to increase in October 2018 and February 2016 reports respectively, a clear
resolution to the city’s unrest is proving to be elusive.

The RICS-Spacious Hong Kong Residential
Property Monitor is a monthly sentiment index tracking trends in the commercial
property market. It is a leading indicator for global investment and occupier
markets. The full report is available at www.rics.org/economics.

About RICS

Confidence through Professional Standards

 

RICS promotes and enforces the highest professional
qualifications and standards in the development and management of land, real
estate, construction and infrastructure.
Our name promises the consistent delivery of standards — bringing confidence to
the markets we serve.

 

We accredit 125,000
professionals and any individual or firm registered with RICS is subject to our
quality assurance. Their expertise covers property, asset valuation, real
estate management; the development of infrastructure; and the management of
natural resources, such as mining, farms and
woodland. From environmental assessments and building controls to negotiating
land rights in an emerging economy; if our members are involved the same
professional standards and ethics apply.

 

We believe that standards
underpin effective markets. With up to
seventy per cent of the world’s wealth
bound up in land and real estate, our sector is vital to economic development,
helping to support stable, sustainable investment and growth around the globe.

 

With offices covering the major political and financial centres of the world, our market presence means
we are ideally placed to influence policy and embed professional standards. We
work at a cross-governmental level, delivering international standards that
will support a safe and vibrant marketplace in land,
real estate, construction and
infrastructure, for the benefit of all.

 

We are proud of our reputation
and work hard to protect it, so clients who work with an RICS professional can have confidence in the quality and ethics
of the services they receive.

About Spacious

Spacious is the
highest quality online real estate platform in Hong Kong. Spacious is capturing
data from real estate searchers and inventory holder and augmenting it with
additional data sets to generate real-time, independent, and actionable
insights. Spacious’ vast property and demographics data can deliver valuable
insights for your organization.

Find
our more here: www.spacious.hk