Hong Kong's first-quarter home purchase forfeitures drop in boost for market sentiment
Wavering sentiment in Hong Kong's residential property market appears to have stabilised, as prices have declined far enough to persuade more buyers to follow through with their commitments, according to one of the city's largest networks of sales agents.
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Forfeitures of deposits, a proxy for homebuyers' confidence, declined to 83 cases in the first three months of this year, a 20 per cent drop from the 104 cases in the last quarter of 2024, according to Centaline. The figure fell 47 per cent year on year, the agency said.
Confidence was bolstered by a policy last year by the Hong Kong Monetary Authority (HKMA) to relax mortgage requirements for buyers of in-progress flats, which reduced the risk that the buyers would forego the initial deposits placed at the peak of the market, said Yeung Ming-yee, a senior associate director at Centaline.
The policy, introduced in December, was a one-off scheme to allow buyers who had bought under-construction homes during the market peak to pay in stages, thus easing their financial burden. Under the plan, banks may lend up to 80 per cent the value of the homes, while the debt-servicing ratio is adjusted to 60 per cent from 50 per cent.
Potential buyers at the sales office of State Pavilia project developed by New World Development at K11 Atelier in North Point on February 15. Photo: Edmond So
The scheme covered uncompleted homes for self-occupation sold between January 1, 2021 and December 31, 2023, where the buyer had paid more than the valuation for the property.
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