What will Hong Kong Property Prices do in 2015?
Well, if we could accurately predict the future we of course would all be retired millionaires by now. But I think a very basic question Hong Kong property investors have to be asking themselves is what is the outlook for Hong Kong property prices in 2015.
On the one hand we have strong demand for property, and very low interest rates. On the other hand we have cooling measures in place, the possibility of interest rates rising, and among other things, political unrest in Hong Kong due to the Occupy Central movement, and the desire of many Hong Kong citizens for true democracy.
If I had to make a guess I would think that overall, prices will keep rising in 2015 in Hong Kong. I can't see interest rates rising at all until late 2015, and even then they will rise only very very slightly, if at all. Property cooling measures are very unlikely to be increased, and they are more and more being "priced in" which means that eventually, when they are removed, the removal of property cooling measures in Hong Kong will be very supportive of property prices. Indeed if removed too rapidly it may lead to a massive spike in prices. They will likely be removed very slowly and steadily (lock step with US interest rate increases), leading to stable price appreciation (which despite the political bantering about "affordable housing", is well recognized by the powers that be as being good for Hong Kong). Further, as the global economy recovers, Hong Kong stands to benefit strongly, due to its unique symbiotic financial relationship with China (which in turn is the "factory of the world".
All in all, the factors going forward, weighed up, point to quite decent property price growth for Hong Kong next year.
I also received numerous emails over the last week noting that Park Island property prices had hit a record high this week (and some thanking me for inspiring them to buy an apartment on Park Island).
Here is the graph from the Centadata Hong Kong property index (for Park Island):
|Centadata HK property index graph for Park Island|
Property prices for Park Island have indeed hit a new peak. There was a dip as the brunt of cooling measures hit, and now a quick recovery of the trend in place since 2009 as investors began to buy back in.
I thought it would be interesting to take a chartist approach to looking at where property prices might go based on historical trends:
|Property price trend forecast for next 3 years for Park Island, Ma Wan, Hong Kong|
Like always, don't rely just on my views, but do take consideration of the trend and make up your own mind. If this convinces you that its the right time buy, hold, or sell property, then great :)