More than half of Hong Kong residents expect home prices in the city to fall over the next twelve months, with the bearish view gaining ground significantly since the third quarter of this year, a private survey shows.
According to the latest Citibank 2018 Residential Property Ownership Survey, which was conducted during this quarter, 57 percent of the people polled said they believe home prices in Hong Kong will drop in the year to come.
The marks a sharp increase in such expectations from the previous quarter, when only 29 percent said they think prices will decline in the next 12 months, the Hong Kong Economic Journal reports.
Also, it is worth noting that in the fourth quarter last year, only 10 percent of the respondents in a similar survey said they expect prices will fall going forward.
For the latest survey, Citibank interviewed 500 citizens, nearly half of whom were homeowners.
It found that only 18 percent of the respondents expressed high or some interest in buying property, representing no obvious change from the third quarter.
Asked whether they think now is a good time to purchase homes, 67 percent said no, compared to 74 percent a quarter earlier, while 4 percent said yes, slightly up from 2 percent in such view in the prior quarter.
Of the respondents that were not homeowners, 63 percent were not hopeful they will be able to afford a home in the next 10 years. Almost half, 45 percent, said they would rather spend their money on holidays abroad and dining out than save up for a down payment on a home.
Lawrence Lam Chi-kong, general manager of Citibank (Hong Kong), said the bank’s surveys have, over the years, shown that interviewees had often been pretty accurate in predicting market corrections.
The reasons for why people are now not seeing a bright prospect for home prices include an unclear economic environment and the interest-rate hike cycle that is underway, Lam said.
The Citi executive believes home prices in Hong Kong will witness 10-15 percent correction next year before gaining support.
While the survey estimated that about 374,000 people in the city had undertaken property viewings in the past month, or down 19 percent from that in the third quarter and down one percent year on year, Lam said it is not certain if the decrease stemmed from negative perceptions of the market or some other factors.
He pointed out that, in general, such number was traditionally fewer in the fourth quarter of a year.
Separately, a survey conducted this quarter by real-estate agency Hong Kong Property showed that more than six in 10 respondents were bearish on the property market for the coming year, with 20.2 percent of them calling a drop of more than 10 percent likely.
Nearly one in five, 19.6 percent, of the respondents believed the housing market will stay stable, while 15.9 percent said they are optimistic the bull market will continue.
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