Due to the interest rate hike and the economic environment, buyers in the secondary property market are cautious in entering the market. Coupled with the competition between first-hand and second-hand private residential flats, transactions of second-hand village houses have dropped more than the 1.4% drop in the overall transaction volume of second-hand private residential flats (non-village houses) in the same period.

In terms of monetary breakdown, transactions of second-hand village houses valued at $5 million or above recorded the biggest drop in the first seven months of this year, with 333 transactions recorded, representing a decrease of 46.2% compared with the same period last year. The number of transactions valued between $4 million and $5 million also fell by 20% to 187.

This is because some buyers have shifted their target from village houses in the New Territories to flatted flats in the urban areas in response to the price adjustment, resulting in a drop in the transactions of high-priced village houses.

On the other hand, transactions of flats valued at $4 million or below recorded an increase, with 122 second-hand village house transactions valued at less than $3 million recording the largest increase, up 8.9% over the same period last year. The largest increase was recorded in 122 transactions of second-hand village houses valued at less than $3 million, an increase of 8.9% over the same period last year.

In the five major districts in the New Territories where traditional village houses are located (including Tai Po, Yuen Long, Sai Kung, Tuen Mun and Sha Tin), a total of 646 transactions and $3,290 million were recorded in the first seven months of this year, representing a drop of 28.7% and 36.0% respectively compared with the 906 transactions and $5,143 million recorded in the first seven months of last year.

Among them, the largest number of transactions of second-hand village houses was registered in Yuen Long District (281 cases), followed by Tai Po District (143 cases) and Sai Kung District (120 cases).

In the first seven months of this year, both the number and value of transactions in the five major districts dropped compared with the same period last year, with Tai Po recording the most significant decline, with 143 transactions and $721 million, down 37.0% and 44.9% respectively compared with the same period last year.

Apart from the softening of the second-hand market, it is believed that the incident in Tai Po village houses earlier this year also affected the transactions in the district. In Tuen Mun, 62 transactions and $297 million were recorded, representing a decrease of 31.1% and 35.0% over the same period last year. In Sai Kung, 120 transactions and $716 million were recorded, representing a drop of 29.8% and 38.1% compared with the same period last year.

In Yuen Long, 281 transactions and $1,354 million were recorded, representing a decrease of 23.6% and 28.9% compared with the same period last year. Sha Tin recorded the smallest drop in the number of transactions, with 40 transactions and $202 million recorded, representing a decrease of 20.0% and 36.6% compared with the same period last year.

On a month-on-month basis, there were 86 transactions of second-hand village houses and $424 million in July this year, representing a drop of 21.1% and 17.2% respectively compared with the 109 transactions and $512 million in June. The number of transactions in July was at a record low this year, dropping for the fourth consecutive month, while the amount of money involved was at a record low for the second consecutive month this year, also dropping for the fourth consecutive month.

Reflecting the low level of transactions in the property market due to negative factors such as high interest rates and falling property prices, transactions of second-hand village houses continued to fall.