HK home prices to fall 10 percent next year: JLL
Small-and-medium sized homes in Hong Kong will fall in price by another 10 percent next year to settle at levels seen back in 2016, according to property firm JLL. At a press conference on Tuesday, Joseph Tsang, chairman of JLL Hong Kong, said the recent partial relaxation of "spicy" property measures did not help revive the sector, as developers are now more actively rolling out sales discounts, while the sluggish stock market has also hit sentiment. Tsang said a further 10 percent fall in prices will take the number of homeowners in negative equity up to 30,000. He added that home prices will not see a significant rebound in the coming years amid plentiful supply, including more than 39,000 subsidised Housing Authority flats expected to enter the market over the next five years. Tsang said the government should therefore completely remove the “spicy measures”, or even offer interest-free loans for young people to buy their first home. He also suggested the authorities consider prioritising public housing development and speeding up the construction of infrastructure surrounding residential areas, especially in Kai Tak. Meanwhile, Alkan Au, senior director of valuation advisory at JLL Hong Kong, called on the government to resume the application mechanism for land sales, which was established in 1999 following the Asian financial crisis but abolished in 2013 due to skyrocketing home prices. Au said reinstating the mechanism could improve the success rate of government land sales.