According to data provided by Centaline Property Agency Ltd, sales of luxury homes in Hong Kong reached their highest in six months in January 2009. A possible indication that the market has stabilised.

Bloomberg reported: Completed transactions of existing properties increased 31 percent from December, and the value of the deals rose 9 percent to HK$2.7 billion ($348 million), the highest since July.

A luxury home is considered to be one valued at more than HK$10 million.

The market “bounce-back”, however, was explained by Marcos Chan, an analyst at Jones Lang LaSalle, who noted that the current lack of supply and lower sales prices were primary reasons behind the increase in transactions in luxury homes in Hong Kong.

This is set against the back-drop of economic recession which is biting hard into the real estate market at large in Hong Kong, where the 2009 outlook remains gloomy.

As reported in Bloomberg: “Since the meltdown of the financial markets in the fourth quarter, it’s no surprise to see a rebound after a sharp drop” in prices, said Chan, head of research for the Pearl River Delta at Jones Lang LaSalle. “Most buyers are those with old money and who hardly need to get financing from banks.”

Wong Leung-sing, an associate director at Centaline, in a Bloomberg report, said “With the lack of new luxury homes, buyers are turning to the second-hand market, rejuvenating activity there.”

Citing unidentified sources, Hong Kong newspaper Ming Pao reported that Joseph Lau, the billionaire chairman of Hong Kong developer Chinese Estate Holdings Ltd and Hong Kong´s fifth richest man, bought a 5,657 square foot duplex for HK$170 million – approximately 16 percent less than the price paid by the seller previously.
 
According to Jones Lang LaSalle´s Chan, it´s still “too early” to say if the luxury segment has stabilised or note.

“We will continue to see pressure this year, whether it’s luxury or mass market real estate, as there are still uncertainties in the economy and unemployment will shoot up,” he said.

source : www.property-report.com