After the government completely lifted housing market regulations, Hong Kong's real estate market experienced a brief period of prosperity. Recent data, however, indicates a decline in transaction volumes and prices. According to Chan Yuk Shing, Director of Real Estate at Eastland Properties, the market currently exhibits significant polarization. The luxury housing market continues to show positive growth, driven by short supply and improved economic indicators. He predicts this year to be a "super luxury home year"; conversely, medium-sized residences face pressures such as interest rate fluctuations, with prices expected to decline by 5% to 6% in the latter half of the year.

In an interview, Chan Yuk Shing pointed out that within four months of the government's complete removal of real estate market regulations, the trend of this year being a "super luxury home year" has indeed been confirmed. There has been a significant increase in transaction volumes in the luxury housing market, with over 48 transactions exceeding HK$100 million, more than doubling the approximately 16 transactions in the first four months before the policy removal.

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Chan noted that luxury home buyers are less sensitive to interest rate changes. Coupled with scarce supply and recent positive economic performance indicators, such as the Caixin China Manufacturing Purchasing Managers' Index remaining above the expansion-contraction threshold for eight consecutive months, reaching 51.8 in June, the highest level since June 2021, these factors have significantly boosted confidence in the luxury housing market.

Meanwhile, the ultra-luxury residential project, South Heaven Phase II at 11A Stubbs Road, Southern District, plans to enter the market from July to August. The project has already commenced soft sales and plans to complete sales arrangements and tender procedures in the coming months.

In contrast, the expected stimulus effects of policy removal on the real estate market are significantly short-lived. For instance, the performance of the primary market reflects this trend. In March, over 4,000 new units were sold, but in recent months, transaction volumes have fallen to approximately 660 units. According to the Rating and Valuation Department's latest data, the private residential price index fell by about 1.23% month-on-month in May, with a cumulative decline of 1.73%.

Chan Yuk Shing emphasized that due to relatively abundant new supply, developers may continue to adopt price reduction strategies. Meanwhile, considering that the US may only lower interest rates once in the latter half of the year, and Hong Kong has not fully followed the magnitude of US rate hikes in the past, it is expected that the local real estate market may not fully follow the rate cut this year. Against the backdrop of increasing new supply, medium-sized residential prices are expected to face a decline of 5% to 6% in the latter half of the year.