According to the latest report released by Knight Frank, the Grade-A office leasing market remained stable. The primary residential sector revived, but the secondary market was further suppressed with the launch of new projects. In the retail property market, rents in core shopping areas appeared to peak as expansion from international brands slowed.
Prime Office
Sentiment in the Grade-A office sales market remained cautious in August. However, despite limited transactions, a result of the sustained effect of the government’s various stamp duties, prices stood firm. Hong Kong’s Grade-A office leasing market remained stable last month, with expansion activity brisk, but the sales sector remained sluggish amid the government’s cooling measures.
Residential
In the residential market, the primary sector revived, but the secondary market was further suppressed with the launch of new projects. With various cooling policies in place and market sentiment remaining cautious, Thomas Lam, Director and Head of Research & Consultancy, Greater China at Knight Frank expects in 2013, the total number of residential sales will fall about 20% to fewer than 70,000, with mass residential prices dropping less than 5% and prices in the more resilient luxury sector falling less than 3% in the rest of the year.
Retail
In the retail property market, rents in core shopping areas appeared to peak as expansion from international brands slowed. Market focus shifted to local retailers who continued to target Mainland visitors and strengthen their market share in locations with lower rents, such as second-tier shopping streets and non-core areas such as the New Territories. Over 2013, Thomas maintains his forecast that rents in prime retail districts will witness annual growth of 3-5%.