Property: HK prepares for shock
Hong Kong property prices are usually volatile although many commentators like to report that they defy gravity. On the whole, property does rise: but one of those pesky downturns is already showing.
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When HSBC announced a 0.5% increase in home loan rates, it rated barely a mention in the next morning's papers.
But the immediate result was that the last weekend of September had, on official figures, the worst sales for more than half a decade.
In the following week, more banks followed HSBC's lead.
And this morning's South China Morning Post reports some commentators now estimating a 10% fall in prices.
Two years ago our own surveys showed rental offers at a 10% discount in less popular areas such as Tsim Sha Tsui, and said that that was a sign that there was underlying overheating.
As HK slips into technical recession with August and September both providing negative growth, the housing market is bound to start to feel the pinch. When and how far prices tumble remain to be seen.
Our guess? 25% by the middle of next year.
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