Property prices in Hong Kong remained positive in June but sales volumes were flat and both have fallen below their three month average, the latest index data shows.
Overall sentiment moderated compared with the previous month, according to the June residential market survey from the Royal Institution of Chartered Surveyors (RICS).
Respondents reported that they have continued to see prices increase. However, measured in net balance terms the proportion of those reporting an increase versus those reporting a decrease fell below the trailing three month moving average.
Respondents also reported that sales volumes were flat in June, the first time volumes weren’t reported to have increased since January. The three month moving average, suggests that volumes will begin to moderate in the coming months.
‘Against this backdrop price and sales expectations were more muted in June than in previous months, though respondents still expect prices and volumes to increase over both time horizons,’ the report says. Respondents have lowered one year price forecasts for the third consecutive month.
Although all three regions, the New Territories, Kowloon, and Hong Kong Island, saw momentum moderate, respondents on Kowloon and Hong Kong Island reported that sales volumes fell in June.
This was the first time that respondents reported a decline in volumes since December, after Hong Kong’s government introduced measures aimed at cooling the property market.
Investment enquiries from mainland China continued to moderate in net balance terms, with only a modest majority of respondents reporting an increase in June versus those reporting a decrease.
The occupier market continued to be robust in June. Respondents continue to report increasing tenant demand across all regions in Hong Kong, and expect rents to increase over the next three months. However, the three-month average rent forecast for the next 12 months moderated to 3.3% in June from 4.2% in May.
