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Monday, November 10, 2008

HK property prices plunge but few buyers

HONG KONG: The window displays at the Hong Kong property agency where Stephen Poon works are bursting with cut prices, last minute reductions and cash incentives.

But buyers were still few and far between, as the stumbling global economy has cut dead the city's five-year booming property market.

"It has been very quiet," said Poon, a property agent for Midland Realty, a large city firm.

"Before September our branch was making HK$2 million to HK$3 million (HK$100 = RM45.42) every month, but now it's only around HK$50,000," he said, describing a 98 per cent drop in revenue.
"I have six kids, three are at university in the UK where fees are high," said Poon, whose commission has inevitably suffered. "It's my mission to make sure I can put them through school, but it is now also my cross to bear."

The global financial crisis is rapidly stunting Hong Kong's office, luxury and residential property markets after they hit a peak in the early summer.

Signs outside agents have shown discounts of more than a HK$1 million in recent weeks and analysts said they expected prices in every sector to drop by an average of 20-30 per cent before next July.

With sellers reluctant to lose value and many potential buyers holding off amid stock market turmoil and tightening lending conditions, many agents in the territory have already lost their jobs.

Nearly 5,000 agents in Hong Kong and China have left the city's biggest property group Centaline since June as the company struggles with plummeting commissions, Centaline's chairman Shih Wing-ching told AFP.


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