According to data from the Lands Department, only one presale application for the subsidized housing project at 12 Tin Sum Road, Hung Shui Kiu, under the Hong Kong Housing Society, was received last month. This marks the second consecutive month without any private residential presale applications, setting a new 12-year low.
Industry observers suggest that the inventory of new properties has exceeded the market's annual absorption capacity. It is anticipated that future supply will decrease to around 10,000 units, and developers may only resume actively submitting presale applications when they see a reduction in inventory levels.
Despite some adjustments to the property market by the government in late October this year, developers have not altered their conservative approach.
According to data released by the Lands Department, only one presale consent application was received in November this year, coming from the subsidized housing project in Hung Shui Kiu, involving 300 units and expected to be completed by the end of December 2024.
According to Lands Department records, there were consecutive months in June 2011 when no private residential presale applications were received, and there was even a period of four consecutive months without any applications.
In 2021, the Lands Department has three times failed to receive presale applications for private residential properties, resulting in only 9,681 new applications for the first 11 months of the year, a decrease of 61.1% compared to the same period last year and a ten-year low.
Denis Ma, Director and Head of Research and Consultancy for the Greater China region at JLL, noted that the recent decrease in presale applications is related to the unfavorable market sentiment and the increase in inventory of new properties.
He stated, "There are currently around 18,000 unsold units in new developments, surpassing the average annual absorption of about 15,000 units. The market needs time to absorb this inventory."
However, some new projects have successfully obtained presale consents and may be ready to launch soon. The Lands Department approved a total of three presale consents last month, involving 1,072 units, representing an increase of 78.4% compared to the previous month.
One of the most anticipated projects is the Phase 2A and 2B development at Ho Man Tin Station, a collaboration between Henderson Land and MTR Corporation, offering a total of 990 units, with completion expected by the end of March 2025.
Additionally, the project at 111 Tai Tong Road, Yuen Long, a collaboration between Kerry Properties and Lai Sun International, also received presale consent for 82 units, with completion expected by the end of July 2024. However, due to the subdued market sentiment, experts predict that these new projects may choose to delay their launches.
