According to the latest report released by Knight Frank, the primary residential market outperformed in April, with developers actively selling remaining units before the implementation of Residential Properties (First-hand Sales) Ordinance (the Ordinance) on 29 April 2013. With the new Ordinance and various other policies coming into effect, there will be a drop in activity in both primary and secondary residential markets in the coming few months.
Prime Office
Due to economic uncertainty and various cooling measures, both the Grade-A office sales and leasing sectors were sluggish in April. Grade-A office rents in Central have bottomed out, rents increased 1.8% in April, the largest month-on-month increase since March 2011. The leasing sector also remained quiet last month, with the local economy continuing to be affected by external uncertainty and demand largely involving relocations rather than expansions.
Thomas Lam, Director and Head of Research & Consultancy, Greater China at Knight Frank believes, Central rents will remain stable in 2013 and rents in Kowloon East are likely to see 10 to 15% growth over the year.
Residential
The primary residential market outperformed last month, with developers actively selling remaining units before the implementation of a new ordinance regulating primary sales. With focus shifting towards the primary property market and continual impact from various stamp duty policies, the secondary market remained quiet in April.
Thomas expects, the volume of residential transactions will fall about 10% over 2013, with mass residential prices dropping around 10% and the more resilient luxury sector falling 5% in 2013.
Retail
In the first quarter of 2013, retail sales growth was slower, due to cautious consumption caused by the weakened external economy and also the fact that the majority of Mainland visitors became mid-end consumers from second or third-tier cities with lower consumption power. Given to the limited supply of prime street shops, the rental growth is expected to reach about 5% in 2013.