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Property News Weekly Digest
2020/5/2
〈Asian Post , May 2, 2020〉Some wealthy property owners in Hong Kong are cashing in their luxury houses, often selling at a loss, as the city faces the threat of its worst recession ever.

Many of them are company owners and executives looking to free up cash to sustain their businesses as the coronavirus pandemic ravages the economy, according to property agents.

"People are losing jobs or getting pay cuts because their companies are not doing well. Thus the business owners, who are the major purchasing force of these luxury homes, are not doing well either. Some may already see liquidity problems and need quick money to stop the bleeding," said Vincent Cheung Kiu-cho, managing director of Vincorn Consulting and Appraisal.

"Offloading luxury homes is a quick fix. The sellers are even willing to cut the price because not many people are willing to place a big bet on luxury homes now."

A villa measuring 1,896 sq ft at Casa Marina 1 in Tai Po was sold for HK$18.9 million last month, with the seller incurring a HK$4.5 million loss on the original investment of HK$23.4 million in 2015.

Another 2,800 sq ft home with a garden of the same size at Valais in Sheung Shui went for HK$43.5 million in March. The owner, who bought the property seven years ago, lost HK$4.5 million on the transaction.

〈Asian Post , May 2, 2020〉HK buyers slow rush to Malaysia amid lockdowns

Enquiries for projects decline by a third from peak last year when unrest drove foreign appeal

Hong Kong buyers are putting aside their plans for investing in Malaysian property as lockdown measures restrict movement, close non-essential businesses and freeze the real estate market along the way.

Enquiries about Malaysian projects from the city have dwindled by about a third from a peak last year when scores of people were looking to escape from social unrest, according to industry analysts.

Centaline Property Agency expects such transactions to fall by a third this year.

"In the first quarter, with the travel restrictions and movement lockdowns, we saw buyer enquiries for Malaysian assets drop significantly from their peak last year," said Georg Chmiel, executive chairman of Juwai IQI, which operates a property portal. "Hong Kong buyers made 32 per cent fewer enquiries in March than they did in January."

Malaysia implemented its Movement Controls Order on March 18 for a month and shut schools and non-essential businesses to help contain the Covid-19 pandemic. While some restrictions have been eased, the order has been extended to May 12.

〈China Daily, May 1, 2020〉Flood of properties with incentives thrown in to meet pent-up demand as lockdowns are lifted

A property buying fever has gripped mainland homebuyers, who are indulging in "revenge spending" as coronavirus lockdowns are lifted in major cities.

All 160 flats at a new luxury project in Shanghai, selling from 17 million yuan (HK$18.6 million) to 78 million yuan, were snapped up on Monday. Those lucky few were drawn from a pool of about 500 applicants, who had to queue last week and deposit 6 million yuan just for a chance to buy.

"The demand was only deferred [by the lockdowns] and did not disappear. With new homes flooding the market, and developers wooing homebuyers with measures such as online viewings [during the outbreak] and discounts, we expect another jump in the coming months," said Lu Wenxi, analyst at Hong Kong-based Centaline Property Agency.

〈China Daily, April 30, 2020〉Office leasing last month weakened in most Asian markets, including Taipei, although the local office market remains in favor of landlords, a survey by international property consultancy Knight Frank LLP found.

Corporations are postponing leasing deals across the Asia-Pacific region as uncertainty builds amid the COVID-19 pandemic, leading to a decline in leasing activity in 11 of 15 office markets, Knight Frank said in a report released on Wednesday.

Activity slowed in Taipei, Seoul, Sydney, Singapore, Jakarta, Kuala Lumpur, Bangkok, Shanghai, Beijing and New Delhi, while it remained stable in Manila and Hong Kong, and China’s Guangzhou and Shenzhen.

"The need to preserve cash and cut expenditure is putting a hold on corporate real-estate decisions such as strategic relocations or fit-out projects that require significant capital outlay," said Tim Armstrong, head of Knight Frank’s regional occupier services.

〈The Standard, April 30, 2020〉The Hong Kong and Shanghai Banking Corporation and Hang Seng Bank (0012) halved the cash rebate by 50 basis points to 0.5 percent for customers transferring their mortgages worth HK$10 million or below to the banks.

Hang Seng Bank has already lowered the cash rebate rate for new mortgage loans below HK$10 million to as much as 1 percent, while that for new mortgages below HK$3 million was cut to 0.5 percent.

The city recorded zero construction for private homes in the first two months this year, the first time in at least 20 years, data from the Buildings Department showed.

The department had approved 13 construction plans in February but hadn't received notification of commencement. Among them, a site on The Peak was approved for three three-story luxury projects with a total floor area of 25,818 square feet.

In the secondary market, a home seller at Flora Plaza, Fan Ling, changed his mind and compensated the buyer, getting back the property for self-use. The deal was made at HK$4.95 million, or HK$13,378 per sq ft.