According to JLL's newly released Hong Kong Property Index for Q1, 2016, Hong Kong home sales dropped 39% quarter-over-quarter to an all-time low of 6,221 in the first quarter of 2016, as market uncertainties continued to deter buyers.
Capital values of luxury and mass residential were generally under downward pressure, declining 0.4% quarter-over-quarter in the luxury market and 5.3% quarter-over-quarter in the mass market.
However, the ultra-luxury residential segment (HKD 100 million and above) continued to hold steady despite faltering sentiment elsewhere the market. A house at 2 Headland Road in Island South fetching HKD 1.02 billion or HKD 95,449 per sq ft, SA.
The rental decline of luxury properties accelerated in 1Q16, dropping 2.8% quarter-over-quarter, as portfolio landlords faced increased vacancy pressure.
Joseph Tsang, Managing Director and Head of Capital Markets at JLL in Hong Kong tells World Property Journal, "The Residential market has clearly softened and prices are now under downward pressure. The government should prepare to revise the cooling measures in the property market, accordingly. Any dramatic drop in residential property prices would strike a major blow to Hong Kong's already fragile economy."