Banks Slash Property Valuations - Market Teeters




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ORIGINAL POST

POSTED BY Ed (2 mths ago)
Banks in Hong Kong are aggressively cutting property valuations as the city’s housing market weakens, threatening to fuel a downward spiral in prices, according to brokerage CLSA Ltd.

https://www.bloomberg.com/news/articles/2018-10-09/hong-kong-banks-slash-property-valuations-as-home-market-teeters

COMMENTS

Ed (2 mths ago)
It would appear that the markets are not liking the end of QE and higher interest rates that this brings....

As has been stated long ago --- the run up in assets has always been about trillions of dollars, Euros, Yen etc.... being pumped into the global economy.... the piper at some point ... needs to be paid....


LIVE: China Shares Fall 5% as Stock Rout Rolls Through Asia

https://www.bloomberg.com/news/live-blog/2018-10-10/markets-live-thursday-oct-11?srnd=premium-asia

Ed (2 mths ago)
Where are the Plunge Protection teams?

Ed (2 mths ago)
How Will 6% Mortgage Rates Deal with Housing Bubble 2?

What many in 2016 thought would never happen again is now reality.
It finally happened – a line in the sand has been breached. The average interest rate for 30-year fixed-rate mortgages with conforming loan balances ($453,100 or less) and a 20% down-payment did what people had thought in 2016 we’d never see again: It breached 5%.

It hit 5.05%, to be precise, for the week ending October 5, according to the Mortgage Bankers Association (MBA) this morning. This is the highest average rate since January 5, 2010 (chart via Investing.com):

https://wolfstreet.com/2018/10/10/how-will-6-mortgage-rates-deal-with-housing-bubble-2/

gdep (2 mths ago)
remember during the worst of financial crisis market plunged by 30% ? Stock market is down by 30% form its peak already. Property has barely started. and govt can loosen a lot of measures, SSD,BSD all that shit. Dont think mortgage rate will increase beyond 3.5% in HK. 15% will be good correction and will be waiting for that to snap something up

Ed (2 mths ago)
Suddenly, there’s a tinge of fear among sellers in Hong Kong’s property market

A recent wave of price discounting for both residential and commercial properties indicates a softening in sentiment

Signs of a deepening slowdown are beginning to emerge in Hong Kong’s property market, with anecdotal evidence showing more homeowners and office space owners are slashing prices in a bid to exit the market, even as there’s few signs of a broad based downtrend.

A 282 square foot flat at Tak Bo Garden in Kowloon Bay sold on Tuesday for HK$4.33 million (US$552,496), or HK$15,355 per sq ft, 8.8 per cent cheaper than an equivalent sized flat in the same area that sold a week earlier. In comparison to a similar unit sold in May, the price was more than 16 per cent lower.

Another homeowner lost more than HK$2.6 million after holding a 1,725 sq ft unit at The Legend in Jardine's Lookout for 11 years. The unit was bought in 2007 for HK$48.6 million and sold on October 9 for HK$46 million, nearly 12 per cent lower than the owner’s original asking price.

“It is the early stage of a bear market already as we see that more homeowners are cutting prices,” said professor Eddie Hui Chi-man from Polytechnic University's department of building and real estate. “If the trade war and interest rate tightening continues, we may see a worse market in the first quarter of 2019.”

“Buyers who are worried about a further plunge of the market rushed to sell their units and continue to lower their asking prices,” said Derek Chan, head of research at Ricacorp Properties. “The gloomy economic outlook will put more pressure on transactions as well as prices in the fourth quarter.”

More https://www.scmp.com/business/article/2168190/suddenly-theres-tinge-fear-among-sellers-hong-kongs-property-market

Ed (2 mths ago)
Sales of newly completed flats flopped for a second consecutive weekend in Hong Kong, as a stock market rout, rising mortgages and the worsening US-China trade war deterred buyers from two newly completed apartment projects in the city.

Nan Fung managed to sell only 100 units, or 20 per cent of the 491 flats offered, at its LP6 project at Lohas Park in Tseung Kwan O as of 5:30pm on Saturday, even after discounting the offers by 19.5 per cent, for an average price of HK$16,006 per square foot. At the One East Coast project at Yau Tong in Kowloon, only 43 of the 130 condominium units on offer were sold, agents said,

https://www.scmp.com/property/hong-kong-china/article/2168445/hong-kongs-home-sales-flop-market-rout-higher-mortgages

Ed (43 days ago)
The warning bell has rung in Hong Kong as prices of used homes in September dropped at a much faster speed than in the previous month, continuing a slide that is sparking worry through the property market, from agencies to homeowners to developers.

Centaline Property Agency has stopped expansion and will lay off agents who aren’t selling homes.

“At least a quarter of agents could lose their jobs,” Louis Chan, Asia-Pacific vice-chairman and chief executive of the residential division at Centaline, said on Tuesday.

Commission revenue at Centaline in October amounted to only about HK$150 million, leading to a loss of about HK$100 million, Chan said. The agency plans to issue warning letters to about 500 agents who made less than HK$100,000 in commissions in the first 10 months of this year.

He likened the downbeat sentiment of the current property market to what happened during the SARS epidemic in 2003, which led to a low turnover.


Chan also predicted that new launches by the end of the year will sell at discounts of 10 to 20 per cent.

https://www.scmp.com/property/hong-kong-china/article/2170978/warning-bell-has-rung-home-prices-dropped-much-faster-last

Ed (35 days ago)
Floor price for prime Hong Kong plot sinks 18 pct

HONG KONG, Nov 7 (Reuters) - Hong Kong sold a harbourfront residential plot for HK$8.33 billion ($1.06 billion) to a consortium led by major local developers, the Lands Department said on Wednesday, fetching less per square foot than a similar sale earlier this year.

The per-square-foot price of the prime plot in Kai Tak, site of the city’s former airport, was 18.4 percent lower than a record sale in the same area six months ago, in another sign of the city’s sizzling property market starting to moderate.

Last week, before the land sale, surveyors lowered their estimates by 5 to 10 percent from previously forecast, to value the site between HK$7.75 billion and HK$9.2 billion.

https://uk.reuters.com/article/hongkong-property-prices/floor-price-for-prime-hong-kong-plot-sinks-18-pct-idUKL4N1WS3BS

Ed (34 days ago)
Hong Kong builders come up with flexible payment plans to woo buyers as sales come to a halt

Wheelock Properties offers deferred payment plans for flats in five of its developments in the city

Analysts expect developers to start cutting prices of new projects when market slows down even further

As Hong Kong’s property market takes a turn for the worse, some developers are coming up with novel payment schemes to offload

https://www.scmp.com/property/hong-kong-china/article/2172184/hong-kong-builders-come-flexible-payment-plans-woo-buyers flats amid fears sentiment could sour further.

Ed (25 days ago)
Hong Kong’s residential property market reported its worst sales weekend in years, as the wind was taken out of the sails of two private project launches by a government offer of discounted housing for first-home buyers.

The Reach Summit project in Yuen Long, jointly built by Henderson Land Development and New World Development, sold six flats as of 6:30pm, a mere 6 per cent of the 102 units on offer, sales agents said. In Tsuen Wan, MCC Real Estate Group sold five of the 50 units at its L’aquatique project.

“The response was lacklustre on both of the launches today,” said Louis Chan, Asia-Pacific vice-chairman at Centaline Property Agency. “The discounts and incentives offered were a test of the market” on how low prices could go, he said.

https://www.scmp.com/property/hong-kong-china/article/2173742/hong-kong-reports-worst-sales-weekend-years-private


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