Summer Break

August 12, 2010

After a spate of brisk sales in June and July, the market is taking a break as summer lethargy sets in. August is always the quietest month of the year, as most people take time out for their vacations. Frontline sales agents are finding more time in their hands but fewer clients viewing properties.

The leasing market however remains buoyant. Expatriates hired by multinational corporations continue to pour in, as Hong Kong and China maintain their economic momentum. Townhouses and large apartments are still in hot demand, but supplies are drying up as many properties have been taken up during the last two months’ rush of activities. The financial industry remains to be the most generous tenants. High rental budgets enable them to have a wider choice of properties but most still prefer Central Midlevels as the gated neighbourhood borders the city’s CBD, thus driving up rentals here at a faster rate than other districts. The Peak is another niche market where most properties are houses and large apartments popular with corporate heads, diplomats, senior government officials and taipans. The prestigious enclave has also experienced shortage of supply and hence upward pressure on rentals.

The lull due to summer vacation may make a dent on the rental up cycle but this will be temporary, because September will see a return of holiday makers who will boost the market again. On the sales front, activities are expected to resume on similar reason plus the fact that in the second half year most investors make their move in September to November. This being said, it will of course depend on the major economic indicators and the market sentiment.

By Koh Keng-shing