Ricacorp: Market Expects Fed Rate Hike Next Month; Weekend Property Viewing Appointments for Hong Kong's 50 Benchmark Estates Fall 1.2%

Chen Hoi-chiu, Head of Property Research at Ricacorp Properties, said the market widely expects the Fed to raise rates next month, disrupting buyers' plans to enter the market and further widening the price gap between buyers and sellers. Although some owners have already lowered their asking prices, under the cloud of a rate hike, most buyers may adopt a wait-and-see approach and look for a more suitable time to enter the market. According to estimates by the Ricacorp Properties research department, a total of 1,190 groups of customers made weekend viewing appointments across Hong Kong's 50 benchmark estates, down 1.2% from 1,205 groups last weekend and falling below the 1,200-group level. By district, weekend viewing appointments for benchmark estates in all three regionsHong Kong Island, Kowloon and the New Territoriesrecorded declines. Among them, the 8 benchmark estates on Hong Kong Island recorded 190 groups of customers booking viewings this weekend, down 2.6% week on week. Lau Shun-man, Assistant Sales Director at Ricacorp Properties for the Lei King Wan and Heng Fa Chuen districts, said no secondary transactions have been recorded at Lei King Wan so far this month, with market activity in the district quiet. He said the market sees a high chance of a US rate hike, which has dampened buyers' sentiment in the district; in addition, several primary projects in urban areas are still being launched this month to attract buyers, diverting secondary-market demand, and viewing appointments in the district have also come under pressure. He added that secondary owners in the district have begun to loosen their bargaining room, but their prices still differ from buyers' ideal levels, leaving both sides in a standoff. In Kowloon, 21 benchmark estates recorded 415 groups of customers booking viewings this weekend, down 1.2% week on week. Tang Tat-wing, Chief Co-Director of the Ricacorp Properties Metro City branch, said that as of mid-month, Metro City had recorded three secondary transactions this month; although this has matched last month's full-month volume, it is still unsatisfactory. He said secondary owners are holding firm on asking prices and have not made significant cuts, while secondary buyers' attention has been diverted by new urban projects, leaving secondary transactions in the district in a standoff, and weekend viewing appointments also edged lower than last week. As for the New Territories, 21 benchmark estates recorded 585 groups of customers booking viewings this weekend, down 0.8% week on week. Siu Kai-nok, Manager of the Ricacorp Properties Tin Shui Wai-Kingswood Villas branch, said the market is worried about an increased chance of a US rate hike next month, with buyers believing prices need room to fall, while most owners are unwilling to cut prices significantly. With buyers and sellers at an impasse, transactions at Kingswood Villas have slowed this month. Buyers are currently mainly taking a wait-and-see stance, and weekend viewing appointments at the estate have also come under pressure. A more notable recovery in transactions is expected only after the interest rate outlook becomes clearer or more owners are willing to widen their price cuts.