© Reuters. An evening view of the financial Central district and Victoria Harbour in Hong Kong, China, May 9, 2023. REUTERS/Tyrone Siu/File Photo
HONG KONG (Reuters) – Hong Kong’s property agents expect more big-ticket foreclosures this year as landlords struggle to refinance, and that receivers will speed up sales after the city’s recent measures aimed at bolstering the depressed real estate market.
CBRE said on Thursday it had been appointed by the receiver to sell an old four-storey residential building in Kowloon, while another agent, Savills, said it had been appointed by the receiver to sell two connected industrial buildings.
“We’ll continue to see many foreclosures this year as landlords fail to negotiate new terms with the lenders after years of poor market and high interest rates,” said Churchill Keung, CBRE Hong Kong capital market assistant manager.
“Some lenders would step up repossessing the asset to put on the market as they think the removal of additional stamp duties could stimulate market sentiment.”
Hong Kong, one of the most expensive property markets in the world, has seen its housing and commercial property prices plunge more than 20% and 30%, respectively, from their peaks.
Last week, the financial hub removed all additional stamp duties, reversing an unsuccessful government push in previous years to cool housing prices, and the home market immediately celebrated with a jump in transactions.
The residential building that CBRE was appointed to sell was seized by creditors this year. It is valued at HK$42 million ($5.37 million), half of its asking price in 2022 when the original owner, the family of deceased property investor Tang Shing Bor, put it on the market.
The industrial buildings, which the lenders seized from Hoixe Cake Shop this year after the company was ordered by a court to liquidate, have an indicative price of HK$510 million ($65.22 million), Savills said, nearly 40% lower than a transaction in the same area in January.
Last week, a second mansion in Hong Kong that once belonged to China Evergrande (HK:) Group’s chairman, was put up for sale by its receivers, according to Savills, which was appointed for the tender sale.
($1 = 7.8197 Hong Kong dollars)
