〈Asian Post, March 28, 2020〉Warnings of further tough times as Midland falls to a loss for 2019 and Centaline sees 38pc drop
Hong Kong's property agencies reported their worst financial results in years for 2019, as the industry struggled with months of anti-government protests and the economic fallout from the US-China trade war.
Midland Holdings, the city's largest publicly listed network of sales agents, reported a 2019 loss of HK$68.92 million, more than double its earlier estimate and a reverse from a 2018 profit of HK$58.13 million. It had warned in December that accumulated losses for the first 11 months of the year were HK$25 million.
Meanwhile its non-residential property unit Midland IC&I posted a HK$19.5 million loss, after a 2018 profit of HK$48.15 million.
The company warned of further troubles ahead, with the coronavirus outbreak adding to the economic woes.
"Coupled with volatility in the stock and bond markets, home prices will be dragged down," said Midland chairman Freddie Wong, in a statement
〈Asian Post, March 27, 2020〉Two of the mainland's biggest property developers have warned that their sales and construction schedules are likely to be disrupted by a downturn in demand caused by the Covid-19 outbreak.
Country Garden Holdings, the largest homes seller, said its progress may be exposed to short-term volatility as business activities remained subdued by efforts to contain the pandemic.
Delivery of 5,000 homes to buyers might be deferred for about two months but the firm would try its best to speed up construction work, president and executive director Mo Bin said.
"Sales in March have rebounded to the normal level, with about 600 million yuan per day," he said, adding that the firm had spent 1.5 million yuan (HK$1.64 million) on four facial mask production lines. "The masks will be for the use of our staff, and we will also donate to Wuhan, the government and overseas."
The Guangdong-based company reported a 17.6 per cent rise in core profit to 40.12 billion yuan in 2019. That was well below the 38.2 per cent gain it reported in 2018. It announced a final dividend yesterday of 34.25 fen, up 13 per cent from a year ago.
〈Business Post, March 26, 2020〉Some of the mainland's biggest property developers are set to accelerate sales and shorten construction cycles to shore up cash flow in response to the economic fallout from the Covid-19 pandemic.
Four of them reported higher profit growth for 2019 yesterday, but said they were braced for hard times ahead as the epidemic squashed market demand.
Poly Property Group, whose sales fell 25.6 per cent to HK$3.48 billion in January and February, revealed its plan to shift inventory faster when it reported profit growth of 71 per cent to HK$3.83 billion for 2019, according to a filing to the Hong Kong stock exchange yesterday.
"The group will put great efforts into destocking, in particular commercial properties and parking spaces and other products that have longer sales cycles, in order to improve liquidity," chairman Zhang Bingnan said in a statement.
To enhance competitiveness, Poly said it would be "strictly controlling the development schedule of projects and converting new land reserves into saleable products".
Revenue jumped 71.9 per cent to HK$39.94 billion, thanks to its Vibe Centro project in Kai Tak, the first development operated by the company in Hong Kong.
〈China Daily, March 21, 2020〉After Sars epidemic of 2003, mainland visitors, companies and emigrants turned city's slumping economy around, but they may not be here this time
Eric Pau, senior associate director at one of Hong Kong's biggest real-estate agencies, vividly remembers the last time a global pandemic brought the city's property market to its knees.
A 23-year-old property salesman at the Amoy Gardens housing estate in the Kowloon Bay area in 2003, Pau said he could feel the panic spreading through the neighbourhood when 321 of the 19,000 residents in the estate's 19 apartment blocks caught the severe acute respiratory syndrome (Sars).
"Nobody would go and view flats. People tended to rent instead of buy at that time," said Pau, who is with Ricacorp Properties. "Those living at Amoy wanted to move out or buy somewhere else. People were scared. There were not many clients at that time."
The experience of Sars is seared on Hongkongers' collective memory. Now, the housing market is again under the gun, as a second coronavirus pandemic runs its course through the city.
〈Hong Kong Post, March 25, 2020〉Recent market carnage putting Hong Kong investors on the alert as many seek a home overseas after months of unrest and economic fallout
Hongkongers are relishing the prospect of picking up global properties on the cheap, as the recent market troubles sent major currencies lower and emergency rate cuts flattened borrowing costs.
The Hong Kong dollar is trading at the stronger end of its band during the market carnage, courtesy of its decades-old peg to the US dollar.
It has appreciated by between 4.7 per cent and 15.5 per cent so far this year against major and regional currencies, including the British pound, Canadian dollar, Australian dollar, the euro and the Singapore dollar, according to Bloomberg Market data.
The situation is putting deep-pocketed investors on alert, just as many are looking to emigrate from the city after experiencing months of social unrest in 2019.
Funding costs have declined as the US Federal Reserve led global emergency rate cuts to counter the economic impact of the coronavirus outbreak.
"In almost every market where Hong Kong buyers are significantly active, they can buy property for much cheaper now than just a couple of weeks ago," said Georg Chmiel, executive chairman of Juwai IQI, an international property portal.