An unprecedented increase in flat sales in Hong Kong has brought property analysts back to their desks to recalculate. The progressive territory, long known to be a tax haven for investors and corporations, is also famous for being the world’s priciest in terms of the housing industry. While this provided steady and robust revenue for the property market, the last quarter of 2017 along with the first quarter of 2018 saw a decline in flat sales. This prompted real estate market analysts to project a grim scenario for the housing market for the rest of 2018. That is set to change, however, as the month of July saw an uptick in sales, sharply defying property market forecasts.
Forecasts Are Meant To Guide
One of the best things about the property market is that everything occurring within the industry is not preordained and whatever action anyone does at present may or may not influence future aftermaths. This means that any forecast about the real estate industry made at present may never happen in the future. Industry players agree that such forecasts are not meant to be viewed as gospel-truth, rather, intended as guidance for all stakeholders.
The Current State of Hong Kong Home Property Market
Nothing comes close to be the best example of this principle than the current state of the property market in Hong Kong. Just when everyone thought that sales are going to be one of the lowest in recent years, timely government policy suddenly reversed the trend. While prices of home properties continue their upward spiral, the imposition of a vacancy tax and the handing out of subsidies to low-income homeowners and first-time home buyers helped alter the trend. These government policies allowed those belonging to these categories to be able to afford buying a new home, which in turn help fuel the sharp increase in sales.
Aside from industry-changing government policies, new and emerging trends like crowdfunding property are also helping sales in the real estate market sector. The rise of crowdfunding platforms that seek to match property developers and sellers with investors play a big role in this area. The concept is very popular, especially among millenials, who prefer to invest a little of their money to own a property that investors rent out to interested parties. Depending on the contract or agreement among investors, the net proceeds are then distributed among the co-owners. The best aspect about this concept is that property crowdfunding investors can always withdraw their investments before it matures. Though it might eliminate them from getting more upon maturity of their investment, this option is viewed by most millennials with great favor.
All of these dynamics have helped defy the dismal forecast for 2018 of most real estate analysts in Hong Kong. The fact that some property developers have started to report a sharp increase in sale of their unoccupied flats prove that business forecasts are not etched in stone. While it remains to be seen whether or not such trend will be sustained until the end of the year, the current development is very much welcomed by both the property sector and homebuyers.