〈The Standard, Feb 17, 2017〉Property Real estate in the Macau SAR continues its upward trajectory. With total transactions increasing dramatically in January. Despite an astounding 60 per cent rise, however, the sector has started to moderate its performance compared to a hectic end to 2016.
The over 20 per cent increase in average home prices last month did not affect purchase sentiment in the residential property market
Total housing transactions soared by 60.4 per cent year-on-year for the first month of the year while average housing prices recorded an increase of 22.8 per cent, the latest official data released by the Financial Services Bureau (DSF) reveals.
In January, a total of 645 home transactions were recorded, up 243 cases vis-a-vis the same month of 2016. Nevertheless, the number represents a notable decrease of 46.7 per cent from the 1,211 transactions of December 2016.
According to official data, the month-on-month slump in housing transactions was due to a high comparison base in December, the 1,211 sales of which were boosted by off-plan purchases in the month, accounting for 528 of the total.
Of the total transactions during the month of January, those for residential units on the Macau Peninsula accounted for 514, surging 70.8 per cent year-onyear, while those for Taipa property increased 66.7 per cent year-onyear to 115.
Nevertheless, compared to the numbers for December, both the Peninsula and Taipa saw housing transactions drop - by 15.9 per cent and 80.3 per cent, respectively.
The city, in fact, saw the opening of sales of a new residential development of Hong Kong-listed conglomerate Shun Tak Group, Nova Grand, in December, with its first batch of some 400 two-room and three-room units sold out in three days.
Total off-plan sales for January thus plunged 88.6 per cent monthon- month to 60. Yet the number, compared to 48 one year ago, went up by 25 per cent.
Meanwhile, transactions on completed units, amounting to 585, increased by 65.2 per cent year-onyear although declining 14.3 per cent month-on-month.
〈China Daily, Feb 16, 2017〉London’s commercial property sector witnessed a sharp surge in Chinese investment in 2016, driven by the weaker pound resulting from uncertainties over Brexit.
Chinese investors bought more than 3.15 billion pounds ($3.9 billion) worth of central London commercial assets in 2016, accounting for 22.5 percent of total central London transaction volumes, compared with their purchase of less than 1 percent in 2006, latest statistics by property broker JLL showed.
Commercial property, mostly office buildings, can generate more than 4 percent net returns for investors, according to estimates by Eric Zhao, an associate director and Chinese capital markets specialist at estate agent Savills.
Laurel Zhang, head of the China and Far East desk at the law firm Sherrards Solicitors, said her team has also noted a very strong Chinese appetite for UK property in 2016 from firsthand experience, which has continued very strongly into 2017.
Although Brexit uncertainties have led to some slight drops in property values, Chinese investors are still getting a bargain due to the depreciation of the pound, said Zhang.
The pound has depreciated more than 10 percent against the yuan since the Brexit referendum in June.
Eric Pang,director and head of the China desk at JLL, said the trend of Chinese investors buying overseas commercial property started in around 2011, led by sovereign wealth funds, insurance firms and institutional investors.
Pang said: “These investors are keen to diversify their asset base, and good asset accumulation they were experiencing in earlier years gave them further capability to invest overseas.”In more recent years, private sector funds and investors and also property investment firms have followed to make investments too, Pang said.
Deals have continued into 2017. CC Land Holdings, a property-holding firm backed by Hong Kong property tycoon Cheung Chung-kiu, bought an office building in Paddington for 292 million pounds in January.
〈China Daily, Feb 16, 2017〉Chinese buyers spent more than three billion pounds ($3.75 billion) on real estate in central London last year. A flag hangs across a street of houses in London on June 3, 2015.
London's commercial real estate market has more or less lost its glamour with deals declining since Brexit, but the market can take some comfort in the fact that Chinese investors still find it attractive, the Wall Street Journal reported.
Chinese buyers spent more than three billion pounds ($3.75 billion) on real estate in central London last year, more modest than UK investors but more generous than those from the US or Europe, real estate consultancy firm Jones Lang LaSalle (JLL) said.
The value of sterling has fallen about 12 percent against the Chinese currency renminbi, or the yuan, since Britain voted to leave the European Union last June, which, for Chinese buyers, means real estate is basically on sale, analysts said.
An office building located in Paddington, London, was sold to CC Land Holdings Ltd, backed by Hong Kong property tycoon Cheung Chung Kiu, for 292 million pounds this year. And in January, a subsidiary of Hong Kong conglomerate Emperor Group bought a building with offices and shops in London's Soho for 260 million pounds.
New York-based real estate market research firm Real Capital Analytics said London's commercial real estate transaction volume dropped by 45 percent to 21.5 billion pounds from 2015 last year. Other foreign investors' withdrawal is making Chinese buyers' influx stand out.
As many investors balk because of the uncertainty over the impact of Brexit, high prices after a multi-year property boom and the returns on London property that have reached near record lows, Chinese buyers see earnings optimism.
Real Capital data showed while the average capitalization rate—a measure of yield—on offices in Hong Kong was 2.6 percent at the end of last year, it was 4.2 percent on offices in London's West End.
〈Asian Post, Feb 16, 2017〉Hong Kong developer New World Development has clinched a government land site in Cheung Sha Wan after paying a higher-than-expected HK$7.794 billion.
This is one of four parcels of land up for tender in February, the largest number of land plots for sale in a single month in the current financial year that ends on March 31.
The four sites, three designated for residential use and the Cheung Sha Wan plot for business purposes, are together estimated to be worth over HK$30 billion.
The Lands Department said yesterday that the tender for the 83,184 square feet site on King Lam Street in Cheung Sha Wan was awarded to Super Record, a subsidiary of New World Development. When completed, the commercial site will feature a maximum gross floor area of 998,210 square feet. The price is higher than analyst forecasts that had ranged from HK$4.9 billion to HK$7.5 billion.
Competing bidders for the site included Cheung Kong Property, Sun Hong Kai Properties, Wheelock Properties and China Overseas Land & Investment.
Adrian Cheng Chi-kong, executive vice-chairman and joint general manager of New World Development, said the company was positive about the commercial development in the area.
"This is the largest commercial land in Kowloon West in recent years. Similar supply is extremely rare in the region and even across Hong Kong," said Cheng.
Analysts said three more sites are to be tendered for sale this month. But despite more supply, land prices are unlikely to ease, said Vincent Cheung Kiu-cho, executive director of valuation and advisory services for Asia at Colliers International.
"It will not be surprising to see record land deals one after another in upcoming tenders as these plots are located in urban areas. Bidding will be fierce."
Cheung added frequent land sales would not exhaust developers' capital as most of them, particularly mainland Chinese firms, have strong financial ability.
〈Macau Post, Feb 15, 2017〉The Heritage Foundation has rated Macau the eighth freest economy in the Asia-Pacific region, the Macau Monetary Authority (AMCM) said yesterday.
The ranking is contained in the foundation’s 2017 Report on the Index of Economic Freedom, which was released this week.
The city’s financial regulator said in a statement the foundation rated Macau’s economy as “mostly free” for the ninth consecutive year. The overall score of economic freedom for Macau is 70.7, well above the world and regional averages, making its economy the 32nd freest among 180 economies rated by the conservative think tank based in Washington, DC.
Once more, Hong Kong was rated the world’s freest economy, ahead of Singapore and New Zealand. Globally, Taiwan ranked 11th and mainland China 111th.
In the Asia-Pacific region, Macau is ranked eighth out of 43 economies, up one place from a year ago.
According to the AMCM statement, the annual report assesses the degree of economic freedom of individual economies around the world based on 12 attributes. Macau received a relatively high score in attributes such as fiscal health, government spending, trade freedom, investment freedom, tax burden, monetary freedom and financial freedom.
The 2017 Report also said that as a free port, Macau has long benefited from global trade and investment. According to the report, the city’s entrepreneurial environment is generally efficient and streamlined, and property rights are generally well respected. Taxation is low and relatively efficient. Since opening up its gaming industry in 2002, Macau has attracted more foreign investment, the report points out.