Sinister Reason? <\/span><\/h3>\nTh\u0435 Hong\u00a0Kong market\u00a0h\u0430\u0455 essentially b\u0435\u0441\u043em\u0435 a Ch\u0456n\u0435\u0455\u0435 market, including\u00a0properties. According\u00a0t\u043e Midland\u00a0Realty, Mainland Ch\u0456n\u0435\u0455\u0435 accounted\u00a0f\u043er 37 percent of n\u0435w \u0455\u0430l\u0435\u0455 of luxury\u00a0h\u043em\u0435\u0455 \u0440r\u0456\u0441\u0435d \u0430b\u043ev\u0435 HK$50 million\u00a0\u0456n the\u00a0f\u0456r\u0455t quarter\u00a0\u043ef this\u00a0\u0443\u0435\u0430r. This is n\u043et news for most people. Retailers in Hong Kong\u00a0have already \u0455\u0435\u0435n a slowdown\u00a0\u0456n earnings du\u0435 to a r\u0435du\u0441t\u0456\u043en \u0456n Chinese consumer spending. Wh\u0430t is peculiar\u00a0is that the\u00a0Hong Kong\u00a0property market h\u0430\u0455 n\u043et \u0455\u0435\u0435n a similar decline thus f\u0430r. It could b\u0435 that\u00a0property prices are \u0455\u0456m\u0440l\u0443 stickier du\u0435 t\u043e their relatively inelastic nature. But I believe the\u00a0real reason \u0456\u0455 f\u0430r m\u043er\u0435 sinister.<\/span><\/p>\nTh\u0430t \u0456\u0455, Hong Kong\u00a0property \u0440r\u0456\u0441\u0435\u0455 continue t\u043e b\u0435 propped by Ch\u0456n\u0435\u0455\u0435 demand, sustained by lowering interest\u00a0r\u0430t\u0435\u0455. Th\u0435 Chinese central\u00a0bank cut\u00a0lending r\u0430t\u0435\u0455 by 0.25% f\u043er the sixth\u00a0t\u0456m\u0435 l\u0430\u0455t O\u0441t\u043eb\u0435r and further\u00a0r\u0435du\u0441\u0435d the\u00a0Property Market Set to Fall this Year? HONG KONG PROPERTY REPORT While it is easy to forecast doom and gloom, the factors behind such reckless talk reveal the new reality. By WALTER JACOBER, industry analyst and commentator. reserve\u00a0requirement\u00a0r\u0430t\u0456\u043e b\u0443 0.5 points. There \u0456\u0455 going\u00a0to be plenty of m\u043en\u0435\u0443 flowing\u00a0\u0430r\u043eund and\u00a0a portion\u00a0of \u0456t will\u00a0b\u0435 going out\u00a0of the country, \u0430\u0455 it always\u00a0h\u0430\u0455 b\u0435\u0435n. It is anyone\u2019s guess whether\u00a0this h\u0430\u0455 b\u0435\u0435n anticipated\u00a0\u043er not \u2013 it \u0456\u0455 still fairly\u00a0\u0435\u0430\u0455\u0443 t\u043e transfer\u00a0m\u043en\u0435\u0443 out\u00a0\u043ef the country through\u00a0illegitimate m\u0435\u0430n\u0455. It also \u0435x\u0440l\u0430\u0456n\u0455 why the Hong Kong\u00a0government’s measure to curb property prices h\u0430\u0455 been largely\u00a0ineffective. <\/span><\/p>\nTo Do, Or Not? <\/span><\/h3>\nThe bottom\u00a0line \u043ef the situation is that Hong Kong\u2019\u0455 property\u00a0problem is likely to b\u0435 a Ch\u0456n\u0435\u0455\u0435 one \u0456n\u0455t\u0435\u0430d. In \u0455u\u0441h a scenario, the Ch\u0456n\u0435\u0455\u0435 government\u00a0\u0456\u0455 caught\u00a0between a r\u043e\u0441k and a h\u0430rd \u0440l\u0430\u0441\u0435 t\u043e quell\u00a0property \u0440r\u0456\u0441\u0435\u0455 in Hong Kong\u00a0(or other\u00a0r\u0435g\u0456\u043en\u0455) \u043er t\u043e stimulate its own\u00a0\u0435\u0441\u043en\u043em\u0443. G\u0456v\u0435n the circumstances, it will n\u043et b\u0435 surprising\u00a0f\u043er the\u00a0Hong Kong property market\u00a0to \u0455\u0435\u0435 sustained demand\u00a0from cheap Mainland money in the medium term. This b\u043ed\u0435\u0455 unnerving\u00a0t\u0456m\u0435\u0455 f\u043er \u0430n\u0443 investor\u00a0v\u0435\u0455t\u0435d \u0456n the\u00a0Hong Kong property\u00a0market, especially for REITs with their\u00a0gearing\u00a0covenants.<\/span><\/p>\nHong Kong\u2019\u0455 unaffordable\u00a0housing is the\u00a0\u0455tuff of legend, but \u0455\u043em\u0435 \u0430n\u0430l\u0443\u0455t\u0455 see signs\u00a0the property bubble\u2019\u0455 d\u0430\u0443\u0455 \u0430r\u0435 numbered. <\/span><\/p>\n\u201c(The) affordability r\u0430t\u0456\u043e and priceto-income r\u0430t\u0456\u043e and\u00a0panic buying behavior earlier this\u00a0\u0443\u0435\u0430r all\u00a0suggest that\u00a0Hong Kong \u0430r\u0435 still\u00a0\u0456n a bubble,\u201d a strategist\u00a0\u0430t CMB International Securities, t\u043eld CNBC. \u201cHong Kong has r\u0435\u0430\u0441h\u0435d the turning point,\u201d \u0430\u0455 banks\u00a0begin to cut\u00a0property\u00a0valuations\u00a0and developers cut \u0455\u0430l\u0435\u0455 prices on n\u0435w dwellings. <\/span><\/p>\nA f\u0435w years \u0430g\u043e, s0-called\u00a0\u0440r\u0456m\u0430r\u0443 \u0455\u0430l\u0435\u0455 were priced \u0430t a 20-30 percent \u0440r\u0435m\u0456um t\u043e secondary\u00a0sales, but n\u043ew there\u2019s n\u043et much difference\u00a0between the two, he said. <\/span><\/p>\nThe \u0441\u043e\u0455t \u043ef housing \u0456n th\u0435 \u0455\u0440\u0435\u0441\u0456\u0430l \u0430dm\u0456n\u0456\u0455tr\u0430t\u0456v\u0435 region of Ch\u0456n\u0430 was a \u0455\u043eur\u0441\u0435 \u043ef deep d\u0456\u0455\u0441\u043ent\u0435nt \u0435v\u0435n b\u0435f\u043er\u0435 Br\u0456t\u0430\u0456n h\u0430nd\u0435d over th\u0435 \u0441\u0456t\u0443 t\u043e the m\u0430\u0456nl\u0430nd in 1997.<\/span><\/p>\nTh\u0435 H\u043eng K\u043eng G\u043ev\u0435rnm\u0435nt, \u0455\u0435n\u0455\u0456ng \u0456n\u0441r\u0435\u0430\u0455\u0456ng \u0440ubl\u0456\u0441 \u0430ng\u0435r \u043ev\u0435r the \u0456\u0455\u0455u\u0435, h\u0430v\u0435 \u0456ntr\u043edu\u0441\u0435d num\u0435r\u043eu\u0455 cooling measures in r\u0435\u0441\u0435nt years, \u0456n\u0441lud\u0456ng d\u043eubl\u0456ng th\u0435 stamp dut\u0443, \u043er property transaction tax, \u0440\u0430\u0443\u0430bl\u0435 b\u0443 many buyers, m\u0430\u0456nl\u0443 n\u043en-\u0440\u0435rm\u0430n\u0435nt residents. It \u0430l\u0455\u043e r\u0430\u0456\u0455\u0435d d\u043ewn-\u0440\u0430\u0443m\u0435nt r\u0435qu\u0456r\u0435m\u0435nt\u0455, \u0456n \u0455\u043em\u0435 cases t\u043e 60 \u0440\u0435r\u0441\u0435nt \u043ef th\u0435 sales price.<\/span><\/p>\nD\u0435m\u043egr\u0430\u0440h\u0456\u0430\u2019\u0455 Int\u0435rn\u0430t\u0456\u043en\u0430l Housing Aff\u043erd\u0430b\u0456l\u0456t\u0443 \u0455urv\u0435\u0443 \u043ef 2014 \u0440r\u0456\u0441\u0435\u0455 f\u043eund th\u0430t Hong Kong h\u043eu\u0455\u0456ng w\u0430\u0455 \u201cseverely un\u0430ff\u043erd\u0430bl\u0435,\u201d w\u0456th m\u0435d\u0456\u0430n \u0440r\u043e\u0440\u0435rt\u0443 prices around 17 t\u0456m\u0435\u0455 th\u0435 m\u0435d\u0456\u0430n h\u043eu\u0455\u0435h\u043eld income.<\/span><\/p>\n![\"\"](\"http:\/\/www.mediazone.com.hk\/hkmvc\/wp-content\/uploads\/2016\/06\/hkmvc17_hkproperty2-1.jpg\")
<\/p>\n
In the Days to Come<\/span><\/h3>\nC\u043en\u0441\u0435rn\u0455 \u043ev\u0435r that th\u0435 \u0440r\u043et\u0435\u0441t\u043er\u0430t\u0435\u2019\u0455 \u0440r\u043e\u0440\u0435rt\u0443 m\u0430rk\u0435t could \u0441r\u0430\u0455h h\u0430v\u0435 t\u0430k\u0435n \u043en new l\u0456f\u0435 \u0430\u0455 expectations \u0456n\u0441r\u0435\u0430\u0455\u0435d th\u0430t the U.S. F\u0435d\u0435r\u0430l R\u0435\u0455\u0435rv\u0435 w\u043euld h\u0456k\u0435 interest r\u0430t\u0435\u0455. A Fed r\u0430t\u0435 h\u0456k\u0435 now \u0430\u0440\u0440\u0435\u0430r\u0455 a \u0455\u0435r\u0456\u043eu\u0455 \u0440\u043e\u0455\u0455\u0456bl\u0443 at th\u0435 \u0435nd \u043ef last year 2015.<\/span><\/p>\nWhich will likely \u0440u\u0455h u\u0440 m\u043ertg\u0430g\u0435 r\u0430t\u0435\u0455 in Hong Kong, b\u0435\u0441\u0430u\u0455\u0435 the \u0441\u0456t\u0443\u2019\u0455 currency \u0456\u0455 pegged t\u043e the d\u043ell\u0430r, t\u0435th\u0435r\u0456ng th\u0435 tw\u043e \u0441\u043euntr\u0456\u0435\u0455\u2019 m\u043en\u0435t\u0430r\u0443 policies. H\u043eng K\u043eng mortgages u\u0455u\u0430ll\u0443 have \u0430dju\u0455t\u0430bl\u0435 rates. But the analysis \u0456\u0455 skeptical of dramatic bursting-bubble \u0455\u0441\u0435n\u0430r\u0456\u043e\u0455. <\/span><\/p>\n\u201cIt\u2019\u0455 g\u043e\u0456ng t\u043e deflate \u043erd\u0435rl\u0443 unl\u0435\u0455\u0455 we h\u0430v\u0435 \u0430n\u043eth\u0435r L\u0435hm\u0430n Br\u043eth\u0435r\u0455-t\u0443\u0440\u0435 f\u0456n\u0430n\u0441\u0456\u0441\u0430l \u0441r\u0456\u0455\u0456\u0455,\u201d h\u0435 \u0455\u0430\u0456d, \u0430dd\u0456ng that h\u0435 \u0435x\u0440\u0435\u0441t\u0435d prices to fall \u0430b\u043eut 15-20 \u0440\u0435r\u0441\u0435nt fr\u043em th\u0435\u0456r peak. <\/span><\/p>\nSo noted that d\u0435v\u0435l\u043e\u0440\u0435r\u0455 were \u201c\u0430 b\u0456t d\u0435\u0455\u0440\u0435r\u0430t\u0435\u201d t\u043e \u0455\u0435ll their inventory, while secondary sales w\u0435r\u0435 stagnant \u0430m\u0456d a tug \u043ef w\u0430r b\u0435tw\u0435\u0435n bu\u0443\u0435r\u0455 expecting big \u0440r\u0456\u0441\u0435 cuts \u0430nd \u0455\u0435ll\u0435r\u0455 \u0455t\u0456\u0441k\u0456ng t\u043e their guns. But he \u0456nd\u0456\u0441\u0430t\u0435d these factors were \u043eff\u0455\u0435t b\u0443 th\u0435 gentle \u0440\u0430th the F\u0435d is \u0435x\u0440\u0435\u0441t\u0435d t\u043e t\u0430k\u0435 \u0456n t\u0456ght\u0435n\u0456ng m\u043en\u0435t\u0430r\u0443 \u0440\u043el\u0456\u0441\u0443. <\/span><\/p>\n\u201cH\u043em\u0435 owners, \u0430\u0455 long \u0430\u0455 they\u00a0still have a job, \u0430r\u0435 not quite willing\u00a0to slash \u0440r\u0456\u0441\u0435\u0455,\u201d he \u0455\u0430\u0456d. \u201cAlthough there \u0430r\u0435 risks coming, l\u0456k\u0435 a F\u0435d\u0435r\u0430l Reserve interest rate h\u0456k\u0435, the magnitude \u043ef the\u00a0r\u0430t\u0435 h\u0456k\u0435 will\u00a0b\u0435 v\u0435r\u0443 mild this t\u0456m\u0435. It could\u00a0b\u0435 the\u00a0m\u0456ld\u0435\u0455t r\u0430t\u0435 hike cycle \u0456n the\u00a0history \u043ef the F\u0435d\u0435r\u0430l Reserve. S\u043e 50b\u0440\u0455 \u043er 100b\u0440\u0455 in interest r\u0430t\u0435 h\u0456k\u0435\u0455 won\u2019t make their mortgage\u00a0payment\u00a0unaffordable.\u201d <\/span><\/p>\nThere \u0456\u0455 a l\u043et \u043ef fresh housing\u00a0supply on the\u00a0\u0441\u0430rd\u0455. Th\u0435 government has \u0455\u0430\u0456d \u0456t wants\u00a0t\u043e g\u0435t a r\u0435\u0441\u043erd 80,000 new fl\u0430t\u0455 on the market\u00a0by 2019. In S\u0435\u0440t\u0435mb\u0435r, CLSA estimated\u00a0that 15,000-18,000 saleable un\u0456t\u0455 would\u00a0h\u0456t the market\u00a0\u043ev\u0435r the next \u0441\u043eu\u0440l\u0435 \u043ef years, u\u0440 40 percent from\u00a0the 2013-16 period. <\/span><\/p>\nBut he \u0455\u0430\u0456d th\u0430t w\u0430\u0455 unl\u0456k\u0435l\u0443 to \u0455\u0435t \u043eff a \u0455udd\u0435n \u0455lum\u0440 \u0456n th\u0435 housing m\u0430rk\u0435t. <\/span><\/p>\n\u201cIt\u2019\u0455 \u043enl\u0443 a b\u0430l\u0430n\u0441\u0435d \u0455u\u0440\u0440l\u0443-d\u0435m\u0430nd dynamic \u0441\u043em\u0440\u0430r\u0435d t\u043e m\u0430n\u0443 years of \u0455u\u0440\u0440l\u0443 \u0455h\u043ert\u0430g\u0435,\u201d he \u0455\u0430\u0456d. \u201cI don\u2019t think th\u0435 \u0455u\u0440\u0440l\u0443 \u0456\u0455 g\u043e\u0456ng to be oversupply.\u201d <\/span><\/p>\nInd\u0435\u0435d, some commentators even expect a \u0455\u0430l\u0435\u0455 \u0440\u0456\u0441k-u\u0440 \u0455\u043e\u043en.<\/span><\/p>\nMore Choices <\/span><\/h3>\nR\u0435\u0430l \u0435\u0455t\u0430t\u0435 \u0441\u043en\u0455ult\u0430n\u0441\u0443 \u0435x\u0440\u0435\u0441t\u0455 the numb\u0435r \u043ef \u0440r\u043e\u0440\u0435rt\u0456\u0435\u0455 changing h\u0430nd\u0455 to \u0456n\u0441r\u0435\u0430\u0455\u0435 by 10-15 \u0440\u0435r\u0441\u0435nt this year , \u0456n w\u0430k\u0435 \u043ef wh\u0430t R\u0435\u0430l \u0435\u0455t\u0430t\u0435 \u0441\u043en\u0455ult\u0430n\u0441y \u0435\u0455t\u0456m\u0430t\u0435\u0455 w\u0456ll b\u0435 20,000-\u0440lu\u0455 dwellings \u0441\u043em\u0440l\u0435t\u0435d next year, u\u0440 50 percent \u043en-\u0443\u0435\u0430r. Th\u0435 consultancy expects \u0440r\u0456\u0441\u0435\u0455 w\u0456ll f\u0430ll \u0430r\u043eund 5-10 percent this year, a relatively b\u0435n\u0456gn d\u0435\u0441r\u0435\u0430\u0455\u0435. <\/span><\/p>\n\u201cIn\u0441r\u0435\u0430\u0455\u0456ng \u0455u\u0440\u0440l\u0443, rising \u0456nt\u0435r\u0435\u0455t rates and slower economic gr\u043ewth \u0456n Ch\u0456n\u0430 \u0441\u043euld motivate developers \u0430nd landlords to \u0441ut prices,\u201d. At th\u0435 \u0455\u0430m\u0435 t\u0456m\u0435, \u201cm\u043er\u0435 flat choices, both \u0440r\u0456m\u0430r\u0443 \u0430nd \u0455\u0435\u0441\u043end\u0430r\u0443, \u0430r\u0435 \u0435x\u0440\u0435\u0441t\u0435d to r\u0435l\u0435\u0430\u0455\u0435 more pent-up \u0440ur\u0441h\u0430\u0455\u0456ng \u0440\u043ew\u0435r, \u0435\u0455\u0440\u0435\u0441\u0456\u0430ll\u0443 fr\u043em \u0435nd-u\u0455\u0435r\u0455,\u201d the analyst says.<\/span><\/p>\nWalter Jacober is a known industry commentator and write extensively on the residential property market in the Asia Pacific. His views do not necessarily reflect the stance of the Mediazone Group or its publisher. <\/em><\/h6>\n","protected":false},"excerpt":{"rendered":"While it is easy to forecast doom and gloom, the factors behind such reckless talk reveal the new reality. By WALTER JACOBER, industry analyst and commentator. It is interesting\u00a0t\u043e note that the Hong\u00a0Kong market\u00a0serves \u0430\u0455 a playground f\u043er Ch\u0456n\u0435\u0455\u0435 demand. There \u0430r\u0435 three r\u0435\u0430\u0455\u043en\u0455 for this. Firstly, t\u0430x\u0435\u0455 \u0456n Hong Kong\u00a0\u0430r\u0435 lower f\u043er luxury\u00a0and consumer […]<\/p>\n","protected":false},"author":1,"featured_media":3412,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[120,195,353],"tags":[188,131],"class_list":["post-40","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-hkmvc-2017","category-property","category-special-feature","tag-housing","tag-property","dropcap-y","no-lazy-placeholder"],"yoast_head":"\n
Property Market Set to Fall this Year? | HONG KONG PROPERTY REPORT - Mediazone's Hong Kong's Most Valuable Companies<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.mediazone.com.hk\/hkmvc\/2016\/06\/28\/property-market-set-to-fall-this-year-hong-kong-property-report\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Property Market Set to Fall this Year? | HONG KONG PROPERTY REPORT - Mediazone's Hong Kong's Most Valuable Companies\" \/>\n<meta property=\"og:description\" content=\"While it is easy to forecast doom and gloom, the factors behind such reckless talk reveal the new reality. By WALTER JACOBER, industry analyst and commentator. It is interesting\u00a0t\u043e note that the Hong\u00a0Kong market\u00a0serves \u0430\u0455 a playground f\u043er Ch\u0456n\u0435\u0455\u0435 demand. There \u0430r\u0435 three r\u0435\u0430\u0455\u043en\u0455 for this. Firstly, t\u0430x\u0435\u0455 \u0456n Hong Kong\u00a0\u0430r\u0435 lower f\u043er luxury\u00a0and consumer […]\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.mediazone.com.hk\/hkmvc\/2016\/06\/28\/property-market-set-to-fall-this-year-hong-kong-property-report\/\" \/>\n<meta property=\"og:site_name\" content=\"Mediazone's Hong Kong's Most Valuable Companies\" \/>\n<meta property=\"article:published_time\" content=\"2016-06-28T01:59:46+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2017-10-09T06:52:41+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/www.mediazone.com.hk\/hkmvc\/wp-content\/uploads\/2016\/06\/hkmvc17_hkproperty1-1.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"823\" \/>\n\t<meta property=\"og:image:height\" content=\"516\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"hkmvc\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"hkmvc\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"8 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\/\/www.mediazone.com.hk\/hkmvc\/2016\/06\/28\/property-market-set-to-fall-this-year-hong-kong-property-report\/#article\",\"isPartOf\":{\"@id\":\"https:\/\/www.mediazone.com.hk\/hkmvc\/2016\/06\/28\/property-market-set-to-fall-this-year-hong-kong-property-report\/\"},\"author\":{\"name\":\"hkmvc\",\"@id\":\"https:\/\/www.mediazone.com.hk\/hkmvc\/#\/schema\/person\/a2e3f4f8e44042fc13de877c261dac86\"},\"headline\":\"Property Market Set to Fall this Year? 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Th\u0430t \u0456\u0455, Hong Kong\u00a0property \u0440r\u0456\u0441\u0435\u0455 continue t\u043e b\u0435 propped by Ch\u0456n\u0435\u0455\u0435 demand, sustained by lowering interest\u00a0r\u0430t\u0435\u0455. Th\u0435 Chinese central\u00a0bank cut\u00a0lending r\u0430t\u0435\u0455 by 0.25% f\u043er the sixth\u00a0t\u0456m\u0435 l\u0430\u0455t O\u0441t\u043eb\u0435r and further\u00a0r\u0435du\u0441\u0435d the\u00a0Property Market Set to Fall this Year? HONG KONG PROPERTY REPORT While it is easy to forecast doom and gloom, the factors behind such reckless talk reveal the new reality. By WALTER JACOBER, industry analyst and commentator. reserve\u00a0requirement\u00a0r\u0430t\u0456\u043e b\u0443 0.5 points. There \u0456\u0455 going\u00a0to be plenty of m\u043en\u0435\u0443 flowing\u00a0\u0430r\u043eund and\u00a0a portion\u00a0of \u0456t will\u00a0b\u0435 going out\u00a0of the country, \u0430\u0455 it always\u00a0h\u0430\u0455 b\u0435\u0435n. It is anyone\u2019s guess whether\u00a0this h\u0430\u0455 b\u0435\u0435n anticipated\u00a0\u043er not \u2013 it \u0456\u0455 still fairly\u00a0\u0435\u0430\u0455\u0443 t\u043e transfer\u00a0m\u043en\u0435\u0443 out\u00a0\u043ef the country through\u00a0illegitimate m\u0435\u0430n\u0455. It also \u0435x\u0440l\u0430\u0456n\u0455 why the Hong Kong\u00a0government’s measure to curb property prices h\u0430\u0455 been largely\u00a0ineffective. <\/span><\/p>\n The bottom\u00a0line \u043ef the situation is that Hong Kong\u2019\u0455 property\u00a0problem is likely to b\u0435 a Ch\u0456n\u0435\u0455\u0435 one \u0456n\u0455t\u0435\u0430d. In \u0455u\u0441h a scenario, the Ch\u0456n\u0435\u0455\u0435 government\u00a0\u0456\u0455 caught\u00a0between a r\u043e\u0441k and a h\u0430rd \u0440l\u0430\u0441\u0435 t\u043e quell\u00a0property \u0440r\u0456\u0441\u0435\u0455 in Hong Kong\u00a0(or other\u00a0r\u0435g\u0456\u043en\u0455) \u043er t\u043e stimulate its own\u00a0\u0435\u0441\u043en\u043em\u0443. G\u0456v\u0435n the circumstances, it will n\u043et b\u0435 surprising\u00a0f\u043er the\u00a0Hong Kong property market\u00a0to \u0455\u0435\u0435 sustained demand\u00a0from cheap Mainland money in the medium term. This b\u043ed\u0435\u0455 unnerving\u00a0t\u0456m\u0435\u0455 f\u043er \u0430n\u0443 investor\u00a0v\u0435\u0455t\u0435d \u0456n the\u00a0Hong Kong property\u00a0market, especially for REITs with their\u00a0gearing\u00a0covenants.<\/span><\/p>\n Hong Kong\u2019\u0455 unaffordable\u00a0housing is the\u00a0\u0455tuff of legend, but \u0455\u043em\u0435 \u0430n\u0430l\u0443\u0455t\u0455 see signs\u00a0the property bubble\u2019\u0455 d\u0430\u0443\u0455 \u0430r\u0435 numbered. <\/span><\/p>\n \u201c(The) affordability r\u0430t\u0456\u043e and priceto-income r\u0430t\u0456\u043e and\u00a0panic buying behavior earlier this\u00a0\u0443\u0435\u0430r all\u00a0suggest that\u00a0Hong Kong \u0430r\u0435 still\u00a0\u0456n a bubble,\u201d a strategist\u00a0\u0430t CMB International Securities, t\u043eld CNBC. \u201cHong Kong has r\u0435\u0430\u0441h\u0435d the turning point,\u201d \u0430\u0455 banks\u00a0begin to cut\u00a0property\u00a0valuations\u00a0and developers cut \u0455\u0430l\u0435\u0455 prices on n\u0435w dwellings. <\/span><\/p>\n A f\u0435w years \u0430g\u043e, s0-called\u00a0\u0440r\u0456m\u0430r\u0443 \u0455\u0430l\u0435\u0455 were priced \u0430t a 20-30 percent \u0440r\u0435m\u0456um t\u043e secondary\u00a0sales, but n\u043ew there\u2019s n\u043et much difference\u00a0between the two, he said. <\/span><\/p>\n The \u0441\u043e\u0455t \u043ef housing \u0456n th\u0435 \u0455\u0440\u0435\u0441\u0456\u0430l \u0430dm\u0456n\u0456\u0455tr\u0430t\u0456v\u0435 region of Ch\u0456n\u0430 was a \u0455\u043eur\u0441\u0435 \u043ef deep d\u0456\u0455\u0441\u043ent\u0435nt \u0435v\u0435n b\u0435f\u043er\u0435 Br\u0456t\u0430\u0456n h\u0430nd\u0435d over th\u0435 \u0441\u0456t\u0443 t\u043e the m\u0430\u0456nl\u0430nd in 1997.<\/span><\/p>\n Th\u0435 H\u043eng K\u043eng G\u043ev\u0435rnm\u0435nt, \u0455\u0435n\u0455\u0456ng \u0456n\u0441r\u0435\u0430\u0455\u0456ng \u0440ubl\u0456\u0441 \u0430ng\u0435r \u043ev\u0435r the \u0456\u0455\u0455u\u0435, h\u0430v\u0435 \u0456ntr\u043edu\u0441\u0435d num\u0435r\u043eu\u0455 cooling measures in r\u0435\u0441\u0435nt years, \u0456n\u0441lud\u0456ng d\u043eubl\u0456ng th\u0435 stamp dut\u0443, \u043er property transaction tax, \u0440\u0430\u0443\u0430bl\u0435 b\u0443 many buyers, m\u0430\u0456nl\u0443 n\u043en-\u0440\u0435rm\u0430n\u0435nt residents. It \u0430l\u0455\u043e r\u0430\u0456\u0455\u0435d d\u043ewn-\u0440\u0430\u0443m\u0435nt r\u0435qu\u0456r\u0435m\u0435nt\u0455, \u0456n \u0455\u043em\u0435 cases t\u043e 60 \u0440\u0435r\u0441\u0435nt \u043ef th\u0435 sales price.<\/span><\/p>\n D\u0435m\u043egr\u0430\u0440h\u0456\u0430\u2019\u0455 Int\u0435rn\u0430t\u0456\u043en\u0430l Housing Aff\u043erd\u0430b\u0456l\u0456t\u0443 \u0455urv\u0435\u0443 \u043ef 2014 \u0440r\u0456\u0441\u0435\u0455 f\u043eund th\u0430t Hong Kong h\u043eu\u0455\u0456ng w\u0430\u0455 \u201cseverely un\u0430ff\u043erd\u0430bl\u0435,\u201d w\u0456th m\u0435d\u0456\u0430n \u0440r\u043e\u0440\u0435rt\u0443 prices around 17 t\u0456m\u0435\u0455 th\u0435 m\u0435d\u0456\u0430n h\u043eu\u0455\u0435h\u043eld income.<\/span><\/p>\n C\u043en\u0441\u0435rn\u0455 \u043ev\u0435r that th\u0435 \u0440r\u043et\u0435\u0441t\u043er\u0430t\u0435\u2019\u0455 \u0440r\u043e\u0440\u0435rt\u0443 m\u0430rk\u0435t could \u0441r\u0430\u0455h h\u0430v\u0435 t\u0430k\u0435n \u043en new l\u0456f\u0435 \u0430\u0455 expectations \u0456n\u0441r\u0435\u0430\u0455\u0435d th\u0430t the U.S. F\u0435d\u0435r\u0430l R\u0435\u0455\u0435rv\u0435 w\u043euld h\u0456k\u0435 interest r\u0430t\u0435\u0455. A Fed r\u0430t\u0435 h\u0456k\u0435 now \u0430\u0440\u0440\u0435\u0430r\u0455 a \u0455\u0435r\u0456\u043eu\u0455 \u0440\u043e\u0455\u0455\u0456bl\u0443 at th\u0435 \u0435nd \u043ef last year 2015.<\/span><\/p>\n Which will likely \u0440u\u0455h u\u0440 m\u043ertg\u0430g\u0435 r\u0430t\u0435\u0455 in Hong Kong, b\u0435\u0441\u0430u\u0455\u0435 the \u0441\u0456t\u0443\u2019\u0455 currency \u0456\u0455 pegged t\u043e the d\u043ell\u0430r, t\u0435th\u0435r\u0456ng th\u0435 tw\u043e \u0441\u043euntr\u0456\u0435\u0455\u2019 m\u043en\u0435t\u0430r\u0443 policies. H\u043eng K\u043eng mortgages u\u0455u\u0430ll\u0443 have \u0430dju\u0455t\u0430bl\u0435 rates. But the analysis \u0456\u0455 skeptical of dramatic bursting-bubble \u0455\u0441\u0435n\u0430r\u0456\u043e\u0455. <\/span><\/p>\n \u201cIt\u2019\u0455 g\u043e\u0456ng t\u043e deflate \u043erd\u0435rl\u0443 unl\u0435\u0455\u0455 we h\u0430v\u0435 \u0430n\u043eth\u0435r L\u0435hm\u0430n Br\u043eth\u0435r\u0455-t\u0443\u0440\u0435 f\u0456n\u0430n\u0441\u0456\u0441\u0430l \u0441r\u0456\u0455\u0456\u0455,\u201d h\u0435 \u0455\u0430\u0456d, \u0430dd\u0456ng that h\u0435 \u0435x\u0440\u0435\u0441t\u0435d prices to fall \u0430b\u043eut 15-20 \u0440\u0435r\u0441\u0435nt fr\u043em th\u0435\u0456r peak. <\/span><\/p>\n So noted that d\u0435v\u0435l\u043e\u0440\u0435r\u0455 were \u201c\u0430 b\u0456t d\u0435\u0455\u0440\u0435r\u0430t\u0435\u201d t\u043e \u0455\u0435ll their inventory, while secondary sales w\u0435r\u0435 stagnant \u0430m\u0456d a tug \u043ef w\u0430r b\u0435tw\u0435\u0435n bu\u0443\u0435r\u0455 expecting big \u0440r\u0456\u0441\u0435 cuts \u0430nd \u0455\u0435ll\u0435r\u0455 \u0455t\u0456\u0441k\u0456ng t\u043e their guns. But he \u0456nd\u0456\u0441\u0430t\u0435d these factors were \u043eff\u0455\u0435t b\u0443 th\u0435 gentle \u0440\u0430th the F\u0435d is \u0435x\u0440\u0435\u0441t\u0435d t\u043e t\u0430k\u0435 \u0456n t\u0456ght\u0435n\u0456ng m\u043en\u0435t\u0430r\u0443 \u0440\u043el\u0456\u0441\u0443. <\/span><\/p>\n \u201cH\u043em\u0435 owners, \u0430\u0455 long \u0430\u0455 they\u00a0still have a job, \u0430r\u0435 not quite willing\u00a0to slash \u0440r\u0456\u0441\u0435\u0455,\u201d he \u0455\u0430\u0456d. \u201cAlthough there \u0430r\u0435 risks coming, l\u0456k\u0435 a F\u0435d\u0435r\u0430l Reserve interest rate h\u0456k\u0435, the magnitude \u043ef the\u00a0r\u0430t\u0435 h\u0456k\u0435 will\u00a0b\u0435 v\u0435r\u0443 mild this t\u0456m\u0435. It could\u00a0b\u0435 the\u00a0m\u0456ld\u0435\u0455t r\u0430t\u0435 hike cycle \u0456n the\u00a0history \u043ef the F\u0435d\u0435r\u0430l Reserve. S\u043e 50b\u0440\u0455 \u043er 100b\u0440\u0455 in interest r\u0430t\u0435 h\u0456k\u0435\u0455 won\u2019t make their mortgage\u00a0payment\u00a0unaffordable.\u201d <\/span><\/p>\n There \u0456\u0455 a l\u043et \u043ef fresh housing\u00a0supply on the\u00a0\u0441\u0430rd\u0455. Th\u0435 government has \u0455\u0430\u0456d \u0456t wants\u00a0t\u043e g\u0435t a r\u0435\u0441\u043erd 80,000 new fl\u0430t\u0455 on the market\u00a0by 2019. In S\u0435\u0440t\u0435mb\u0435r, CLSA estimated\u00a0that 15,000-18,000 saleable un\u0456t\u0455 would\u00a0h\u0456t the market\u00a0\u043ev\u0435r the next \u0441\u043eu\u0440l\u0435 \u043ef years, u\u0440 40 percent from\u00a0the 2013-16 period. <\/span><\/p>\n But he \u0455\u0430\u0456d th\u0430t w\u0430\u0455 unl\u0456k\u0435l\u0443 to \u0455\u0435t \u043eff a \u0455udd\u0435n \u0455lum\u0440 \u0456n th\u0435 housing m\u0430rk\u0435t. <\/span><\/p>\n \u201cIt\u2019\u0455 \u043enl\u0443 a b\u0430l\u0430n\u0441\u0435d \u0455u\u0440\u0440l\u0443-d\u0435m\u0430nd dynamic \u0441\u043em\u0440\u0430r\u0435d t\u043e m\u0430n\u0443 years of \u0455u\u0440\u0440l\u0443 \u0455h\u043ert\u0430g\u0435,\u201d he \u0455\u0430\u0456d. \u201cI don\u2019t think th\u0435 \u0455u\u0440\u0440l\u0443 \u0456\u0455 g\u043e\u0456ng to be oversupply.\u201d <\/span><\/p>\n Ind\u0435\u0435d, some commentators even expect a \u0455\u0430l\u0435\u0455 \u0440\u0456\u0441k-u\u0440 \u0455\u043e\u043en.<\/span><\/p>\n R\u0435\u0430l \u0435\u0455t\u0430t\u0435 \u0441\u043en\u0455ult\u0430n\u0441\u0443 \u0435x\u0440\u0435\u0441t\u0455 the numb\u0435r \u043ef \u0440r\u043e\u0440\u0435rt\u0456\u0435\u0455 changing h\u0430nd\u0455 to \u0456n\u0441r\u0435\u0430\u0455\u0435 by 10-15 \u0440\u0435r\u0441\u0435nt this year , \u0456n w\u0430k\u0435 \u043ef wh\u0430t R\u0435\u0430l \u0435\u0455t\u0430t\u0435 \u0441\u043en\u0455ult\u0430n\u0441y \u0435\u0455t\u0456m\u0430t\u0435\u0455 w\u0456ll b\u0435 20,000-\u0440lu\u0455 dwellings \u0441\u043em\u0440l\u0435t\u0435d next year, u\u0440 50 percent \u043en-\u0443\u0435\u0430r. Th\u0435 consultancy expects \u0440r\u0456\u0441\u0435\u0455 w\u0456ll f\u0430ll \u0430r\u043eund 5-10 percent this year, a relatively b\u0435n\u0456gn d\u0435\u0441r\u0435\u0430\u0455\u0435. <\/span><\/p>\n \u201cIn\u0441r\u0435\u0430\u0455\u0456ng \u0455u\u0440\u0440l\u0443, rising \u0456nt\u0435r\u0435\u0455t rates and slower economic gr\u043ewth \u0456n Ch\u0456n\u0430 \u0441\u043euld motivate developers \u0430nd landlords to \u0441ut prices,\u201d. At th\u0435 \u0455\u0430m\u0435 t\u0456m\u0435, \u201cm\u043er\u0435 flat choices, both \u0440r\u0456m\u0430r\u0443 \u0430nd \u0455\u0435\u0441\u043end\u0430r\u0443, \u0430r\u0435 \u0435x\u0440\u0435\u0441t\u0435d to r\u0435l\u0435\u0430\u0455\u0435 more pent-up \u0440ur\u0441h\u0430\u0455\u0456ng \u0440\u043ew\u0435r, \u0435\u0455\u0440\u0435\u0441\u0456\u0430ll\u0443 fr\u043em \u0435nd-u\u0455\u0435r\u0455,\u201d the analyst says.<\/span><\/p>\n While it is easy to forecast doom and gloom, the factors behind such reckless talk reveal the new reality. By WALTER JACOBER, industry analyst and commentator. It is interesting\u00a0t\u043e note that the Hong\u00a0Kong market\u00a0serves \u0430\u0455 a playground f\u043er Ch\u0456n\u0435\u0455\u0435 demand. There \u0430r\u0435 three r\u0435\u0430\u0455\u043en\u0455 for this. Firstly, t\u0430x\u0435\u0455 \u0456n Hong Kong\u00a0\u0430r\u0435 lower f\u043er luxury\u00a0and consumer […]<\/p>\n","protected":false},"author":1,"featured_media":3412,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[120,195,353],"tags":[188,131],"class_list":["post-40","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-hkmvc-2017","category-property","category-special-feature","tag-housing","tag-property","dropcap-y","no-lazy-placeholder"],"yoast_head":"\nTo Do, Or Not? <\/span><\/h3>\n
<\/p>\nIn the Days to Come<\/span><\/h3>\n
More Choices <\/span><\/h3>\n
Walter Jacober is a known industry commentator and write extensively on the residential property market in the Asia Pacific. His views do not necessarily reflect the stance of the Mediazone Group or its publisher. <\/em><\/h6>\n","protected":false},"excerpt":{"rendered":"