Jinwu Financial News | Hong Kong real estate stocks generally declined. New World Development (00017) fell 3.46%, Hysan Development (00014) fell 2.9%, Henderson Land (00012) fell 2.4%, Sun Hung Kai Properties (00016) fell 2.25%, Wharf Land (01997) fell 2.16%, and Swire Group A (00019) fell 1.6%.
According to the UBS Research Report, stocks with capital circulation plans (Land, Taikoo) and sustainable high dividend yields (Kerry, Henderson Land) performed better than the market last year, and it is expected that a similar trend will occur this year. According to the bank, in terms of the housing market, UBS lowered its Hong Kong property price forecast from 0% to 5% to flat this year to reflect the number of interest rate cuts that may be reduced after the US election, and believes that population inflows will drive up residential rents in Hong Kong. Therefore, the bank believes that the Hong Kong housing market will achieve a “positive spread” of 50 basis points by the end of this year (that is, the return on investing in residential properties is higher than the cost of borrowing), and continued high supply and macroeconomic uncertainty in the short term may limit upward space. If property prices fall further sharply, it is expected that support policies such as allowing individuals to use MPF funds to buy or rent properties will be introduced.
Yau Cheuk-man, a Hong Kong real estate analyst at DBS Hong Kong Economic Research Department, said that Hong Kong property prices have dropped by about 28% since their high level. He is still not very optimistic about this year's property price performance because the current annual cargo volume is still as high as 0.02 million units. Coupled with the high debt of developers, this year's market does not have much capacity to increase prices, and will continue to focus on removing inventory. However, residential rental returns have risen to about 3.4 to 3.5%. As Hong Kong has an opportunity to continue to follow the US interest rate cuts this year, actual mortgage interest rates may drop to 3.25%. Unless rental demand suddenly stalls, more investors will enter the market this year, and mainland buyers will become the driving force for entering the market.
