“Hong Kong home prices recorded a 15.6 per cent drop last year due to the Covid-19 pandemic, interest-rate hikes and geopolitical issues. Luxury homes in Hong Kong are forecast to see a 1.5 per cent price decline this year, according to property consultancy Knight Frank. Out of the 24 prime property markets around the world that the consultancy tracked in a recent study, Hong Kong was among just five that are likely to slump this year, as economic headwinds including higher interest rates take a toll, Knight Frank said.
The latest disposals of luxury properties indicate lingering uncertainty over the real-estate segment, even as property deals rose to a three-month high in January, according to data from the Land Registry.
In July, a luxury home in Hong Kong’s Pok Fu Lam residential area owned by the CEO of Kaisa Group Holdings, sold for nearly a fifth lower than the prevailing market rate, according to a source familiar with the situation. The 3,953 square feet two-storey villa changed hands at HK$300 million, according to Centaline Property Agency, which was not involved in the transaction.
House 17 at Residence Bel-Air in Pok Fu Lam was put up for sale by public tender in May by receivers, which included Cosimo Borrelli and Tai Shaw Hoong. The property had been bought for HK$350 million in 2017, according to official records.
Kaisa’s Vice-Chairman and Chief Executive Mai Fan held the villa through Million Link Development, which fell into receivership in December 2021 as its lender sought to recover soured loans. Shenzhen-based property developer Kaisa had been struggling to raise cash to repay debt.
Hong Kong’s total number of property transactions – including deals for residential, commercial and industrial property and parking spaces – reached 4,427 last month, 24.2 per cent higher than the 3,565 transactions recorded in December. The total value of transactions also increased 25.6 per cent to about HK$32.5 billion, a five-month high.The higher property transactions came at the same time as mainland China reopened its borders and dropped most of its stringent pandemic restrictions.
With the resumption of free travel, property agents are pinning their hopes on wealthy mainland buyers who can now freely inspect residential units, while traders can make definite plans for business expansion in Hong Kong.