Hong Kong Home Prices May Drop by 10% Before Recovering, StanChart Says
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Hong Kong home prices, which rose the most globally in the past year, may need to fall as much as 10 percent in 2012 before buyers are lured back, according to Standard Chartered Plc.
“Most people are on the sideline,” Benjamin Hung, chief executive officer of the bank’s local unit, said in an interview yesterday. “They are watching. They are waiting. In order for activities to go up, prices may have to come down to drive a little bit more interest.”
(...) Home prices will probably fall 10 percent next year before transactions return to “a normal level of around 8,000 to 10,000 deals a month,” said Yu Kam-hung, a Hong Kong-based senior managing director at CBRE Group Inc., the world’s biggest commercial property brokerage. The number of home sales has dropped to below 5,500 a month from July to November, according to Land Registry figures.
“Lower transactions combined with a not significant adjustment in the property price suggest that people are watching,” Hung said. “I don’t think there’re a lot of desperate sales.’
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