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Hong Kong Real Estate Running Into Issues in 2023: Update

Hong Kong Real Estate

Hong Kong real estate prices are falling and continue to fall into the year 2023. Read on more to find out why the most expensive city in the world is having problems in its property market. 

As borrowing costs increase, the housing market downturn in Hong Kong is worsening.

According to information released on Friday, the Centaline indicator of secondary housing prices decreased by 2% in the week ending October 30 compared to the prior week, the most since March 2016. The index’s decline brought it to its lowest point since December 2017.

With the Centaline gauge rising by more than 500% from its low point in 2003 to its peak point last year, Hong Kong real estate was among the biggest benefactors of the low global interest rates. Due to rising borrowing prices, a contracting economy, and increased selling pressure brought on by a resident exodus, this is now beginning to turn around. Since its peak in 2021, the secondary home price index has decreased by 14%.

Due to Hong Kong’s currency linkage with the US dollar, the city’s one-month borrowing rate, often known as Hibor, has increased to its highest level since 2008. According to data from the Hong Kong Monetary Authority for new loans from September, more than 96% of mortgages are linked to Hibor.

Residential property values in the city are predicted to decrease 30% from their 2017 levels through 2023, according to Goldman Sachs Group Inc. For an in-depth analysis check out the article here.

Hong Kong Real Estate in 2023:Outlook

A “wait-and-see” mentality is common among homebuyers and homeowners as a result of the uncertain market conditions and worry about interest rate increases.

Due to poor market sentiment, the primary and secondary markets both experienced declines of 8.2% and 5.2% MoM, respectively. According to information from the Land Registry, a total of 3,875 transactions were reported in the residential market, a little decline of 6.3% MoM.

According to the Inland Earnings Department, Hong Kong’s overall stamp duty revenue from home sales registered 202 cases in September, hitting a new two-and-a-half year low. Buyer’s …

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Australia Housing Market
Real Estate Insights

Australia Housing Market In A Downturn, and Decreasing

The housing downturn in Australia continued into November but slowed down, which suggests the real estate market is starting to respond to rising borrowing costs and even the possibility of future interest rate hikes.

Sydney, the bellwether market, where prices fell 1.3% for a 10th consecutive monthly decline, was mostly to blame for the slowdown in the rate of correction, according to a data released on Thursday by CoreLogic Inc. The national index, which incorporates regional markets, experienced its smallest decrease since June in November, down 1%.

The numbers indicate that despite the greatest monetary tightening cycle in a generation, the A$9.7 trillion ($6.5 trillion) property market is holding up fairly well. Since May, the Reserve Bank has increased interest rates by 2.75 percentage points, bringing them to 2.85%.

According to Tim Lawless, research director at CoreLogic, “perhaps we are seeing the initial concern over buying in a higher interest rate environment wearing off.” However, it’s accurate to state that housing risk is still heavily weighted to the negative as long as interest rates continue to rise and household balance sheets continue to deteriorate.

A top RBA official voiced optimism in the Australian property market on Wednesday, noting that prices are still 20% higher than they were at the start of the epidemic. Additionally, as unemployment is at its lowest point in nearly 50 years, borrowers are in a good position to make their obligations, and loan arrears are expected to be kept to a minimum.

“Perhaps we are seeing the initial apprehension over buying in a higher interest rate environment wearing off,” says Tim Lawless, research director at CoreLogic. As long as interest rates keep rising and household balance sheets keep getting worse, it is true to say that housing risk is still significantly skewed in the wrong direction.

On Wednesday, a senior RBA official expressed optimism about the Australian real estate market, noting that prices are still 20% higher than they were before the pandemic. Borrowers are also in a good position to meet their obligations because unemployment is at its lowest level in almost 50 years, and …

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US Housing Market
Real Estate Insights

US Housing Market In A Slump in 2022

The US housing market boom, which lasted for ten years, is over, and the market has become strangely calm.

Both sellers and buyers are making room in the US Housing Market. The real estate professionals who helped them during the epidemic housing craze are now left scrambling for listings or leaving the industry as deals plummet.

Inventory is remaining low, keeping values from declining further as housing prices decline in the most volatile areas and the economy teeters on the brink of recession. However, the industry is in a state of disarray as a result of the upheaval brought on by skyrocketing mortgage rates, which are a result of the Federal Reserve’s campaign to fight inflation. The market is also indicating that tougher days are ahead.

According to Zillow data, sellers listed 24% fewer houses in October than they did a year earlier, marking the fourth consecutive month of a decline. Purchases decreased at the same time and are currently 17% below their October 2019 levels, before Covid hit.

Brokers are having trouble finding buyers because a typical home is now only affordable to those making over $100,000. Try persuading a homeowner to sell as well, especially if doing so would require switching from a 3% mortgage to a lot more expensive one.

Professor of real estate at the Wharton School of the University of Pennsylvania, Benjamin Keys, compared the market to Han Solo in carbonite and said, “This is a market that could stay frozen for quite some time.”

US Housing Market Pressure on Buyers or Sellers?

According to Zandi, homeowners holding off for the time being are waiting for a larger decrease in rates, which would make it simpler to sell and less expensive to acquire anything else. However, when more people get married, have children, or change jobs, there will eventually be a steady rise in listings.

Regarding a future economic slump, Zandi said, “Once the employment market starts to flip — and it will — the pressure will accelerate.” People will need to relocate.

Any additional listings will face competition from houses that are currently …

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