According to Yang Mingyi, Senior Associate Director of Centaline Property Research, less than 40% of the private residential units expected to be completed in 2023 were sold in the second quarter of this year, which is a four-year low and the sales progress is lagging behind.

The proportion of first-hand flats to be completed in the same year in the 2nd quarter of each year has continued to fall, with 70.5% recorded in 2020, 63.4% in 2021, 59.3% in 2022 and only 38.9% in 2023. The proportion of sales has been decreasing year on year, with a significant reduction of 31.6 percentage points over the three-year period. This year, the ratio is even significantly lower, at less than 40%, resulting in an ever-increasing backlog of unsold flats.

In addition, the proportion of private residential flats completed in the previous year has continued to drop in the second quarter of each year, with 71.4% of private residential flats completed in 2022 and 71.4% of private residential flats completed in 2023 sold in 2022, 84.1% of flats completed in 2021 sold in 2022, 85.8% of flats completed in 2020 sold in 2021, and 81.2% of flats completed in 2019 sold in 2020. The proportion has dropped from over 80% in the past to about 70% in 2023, and has even dropped by 14.4 percentage points in the past two years from the high level.

As of the 2nd quarter of 2023, the estimated number of private residential units to be completed in 2023 is 18,937. Of these, 6,422 units are unsold and 5,156 units are unsold. The total number of flats for sale is 11,578, accounting for 61.1% of the estimated annual completion figure and only 38.9% of the total number of flats to be sold.

With the current adjustment in the property market, developers have been actively launching new flats and selling new flats at discounted prices in the hope of catching up with the slowdown in the sales progress. It is estimated that about 50% of the flats will be sold in the third quarter of this year, which is still lower than the previous level.