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Property News Weekly Digest
〈The Standard, May 6, 2022〉Hong Kong’s biggest banks hold their lending costs unchanged for now as finance minister warns public of higher mortgage repayments

Hong Kong’s cost of money soared by the most in 22 years as the city’s de facto central bank followed the US Federal Reserve to usher in an era of faster, bigger rate increases, even while the local economy is reeling from a slump.

The city’s base lending rate rose by 50 basis points to 1.25 per cent, after the Fed raised its rate by half a percentage point, according to a statement by the Hong Kong Monetary Authority (HKMA). That marked the biggest one-time increase in Fed rates since 2000.

"The interest rate adjustment will come at a much faster pace than the last cycle," HKMA’s chief executive Eddie Yue Wai-man said in a media briefing after announcing the monetary policy, warning borrowers to "carefully assess and manage the relevant risks" in borrowing.

The Fed has signalled 10 increments in US interest rates, raising the Fed rate from zero to 2.6 per cent by the end of this year, and to 3.75 per cent by the end of 2023, economists said. That is a faster pace than the previous cycle, when the Fed rate rose 2.25 percentage points in the four years from 2015 to 2018.

〈China Daily, May 5, 2022〉Some rush to leave city after getting immigration approval while others keen to sell off nano flats

Property sales in the city rebounded to a three-month high in April as owners became more willing to offer big discounts, or even sell at a loss, to get deals done, a trend that could drag home prices down further.

The value of transactions rose by about a fifth to HK$41.9 billion as the number of deals increased by more than a quarter to 4,847 from March, according to Centaline Property Agency.

The transactions in Centaline’s figures included homes, shops, industrial units and car parking spaces.

Many homeowners have been willing to lower their prices by as much as 12 per cent, according to analysts.

Their reasons for seeking a quick sale varied. Some – part of an unprecedented exodus of Hongkongers and expatriates – needed to leave the city quickly when the approval of their immigration applications set the timer running.

〈Asian Post, May 5, 2022〉Almost all available units at The Grand Mayfair I in Yuen Long were sold yesterday as buyers continue to snap up projects launched after a three-month lull caused by the fifth wave of Covid-19.

The project, developed by Sino Land, K Wah International and China Overseas Land & Investment, found buyers for 322 of the 327 flats on offer, a company spokeswoman said.

It was the second round of sales after the project atop Kam Sheung Road MTR station sold all 388 units on offer last Friday.

"The pandemic has subsided significantly and the social- distancing measures have been gradually relaxed, which is good for the property market," said Perry Fong, senior principal sales director at Centaline Property Agency.

"Developers are taking advantage of the situation to push ahead with developments at full speed."

〈The Standard, May 3, 2022〉More clients from city looking to own and occupy properties in UK than ever before, agencies say

Property agencies in Britain are providing more "hand-holding" for an influx of first-time buyers from Hong Kong, many of whom arrive without knowledge of the buying process and – in some cases – with inflated expectations about what they can afford.

As the British National (Overseas) visa scheme brings more Hong Kong migrants to the country, agencies focused on clients from Hong Kong have observed a shift in their customer pool, away from seasoned investors and towards first-time buyers.

A regular advertising campaign run by Savills drew more interest in the past year from those without previous buying experience, despite overall sales having plateaued, according to Mark Elliott, Hong Kong-based head of international residential sales for the agency.

"The respondents [to the campaign] were very different to what they have been over the past five years," he said. "These are people who are new to London and haven’t been looking at London before." They had a weaker understanding of the local property market, he added.

〈China Daily, May 2, 2022〉A rebound in the city’s property sector has proved elusive, but what it needs the most right now is a sustained period of stability

Spare a thought for those upbeat property agents who have been insisting for some time a recovery in Hong Kong’s battered commercial real estate sector is just around the corner.

While the big advisers’ views on the outlook for the market differ significantly, mainly due to mounting uncertainty over the prospects for Hong Kong and the global economy, the consensus towards the end of last year was the downturn in the office and retail markets was bottoming out.

In December, JLL said the office market had "entered the last phase of the current down cycle and is on the cusp of a recovery". CBRE, in its market outlook published in early January, noted that high-street rents rose in 2021 for the first time in seven years and said single-digit rental growth this year was achievable.