Following the latest hash of property cooling measures implemented on July 6, the sales volume of private resale apartments has fallen 2.8%.
Fall in private home sales following property curbs
1,085 resale private non-landed properties were sold in July while 1,116 units were sold in June.
The 12-month average for the period of July 2017 to June 2018 is 1,304 units. July’s figures were 16.8% lower than the median and most analysts consider the property curbs the most likely cause.
While developers were able to react quickly to the authorities’ announcement of the cooling measures, most private sellers did not have the same resources. Show flats were filled and real estate agents were activated in full force on July 5 to close deals before the new measures took effect on July 6. The contrast in sales volume prior to and after the curbs were implemented has shown itself to be rather clear.
Resale prices still higher this year than 2017
The overall median amount buyers are willing to pay above market selling prices of resale non-landed properties remains however in the positive price territory. This is despite a sharp $4,000 drop from June’s $17,000.
One of the push factors behind July’s new measures was to eradicate speculative buying and also lower the rate of household debt. Analysts consider the measures effective as most of the buyers are now genuine home-seekers or cash-rich investors.
Sellers may, however, feel the pressure to lower prices in light of the new curbs as developers offer discounts or offer competitive launch prices. The price-gap between buyers and sellers may also narrow in the same stroke.