A man walks past a housing building in Hong Kong on Aug 29, 2020. (PHOTO / AFP)
Hong Kong property developer Hang Lung Properties struck a cautiously upbeat note on the financial hub’s housing market this year amid the quarantine-free travel resumption with the Chinese mainland.
Hang Lung’s chief financial officer Kenneth Chiu Ka-kui said during a news conference on Tuesday that he is not too worried about external economies hammering housing prices, given three factors — border reopening, the city’s healthy average income level and a fallback in the one-month cost of borrowing.
“The travel curbs’ relaxation between the mainland and Hong Kong is expected to raise demand for Hong Kong homes from mainland residents,” Chiu noted.
CEO Weber Lo Wai-pak predicted Hong Kong’s housing market will develop steadily this year with room for a slight rise in prices. After the sector went through a painful reset in the second half of 2021, he said he believes residential demand still exists.
Rising interest rates, COVID-19 curbs, coupled with a dwindling number of potential buyers dealt a blow to the world’s hottest property market in the past few months. An index tracking live-in home prices in Hong Kong went down by 15.6 percent year-on-year in 2022, according to the latest data released by the Rating and Valuation Department
Rising interest rates, COVID-19 curbs, coupled with a dwindling number of potential buyers dealt a blow to the world’s hottest property market in the past few months. An index tracking live-in home prices in Hong Kong went down by 15.6 percent year-on-year in 2022, according to the latest data released by the Rating and Valuation Department.
Hang Lung’s underlying profit declined 4 percent year-on-year to HK$4.2 billion ($535.9 million) last year, while total revenue remained flat at HK$10.35 billion.
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Rental income from property went down 3 percent year-on-year to HK$10.03 billion, while property sales rose to HK$316 million from zero a year ago.
Chairman Ronnie Chan Chi-chung said the company is mainly engaged in commercial building leases on the mainland, and Hong Kong’s residential property is no longer the main business.
“The impact of the Hong Kong property market on the company is not so important,” he said.
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In Hong Kong, Hang Lung has a portfolio of commercial properties including Hang Lung Centre and Fashion Walk in Causeway Bay. It owns 11 office and retail projects in Shanghai, Shenyang, Jinan, Wuxi, Dalian and Tianjin on the mainland.
Lo said the company plans to focus on high-end residential projects in Hong Kong in the future.
Hang Lung Properties’ dividend remained flat at 78 HK cents per share for the last year. Its Hong Kong traded stock closed at HK$14.76, down about 5.3 percent on Tuesday.
Contact the writer at tianyuanzhang@chinadailyhk.com