For this year, the local unit of Hong Kong’s Ricacorp Properties Ltd. says it does not anticipate strong investment sentiment for Macau’s high-end homes, especially luxury unfinished flats, against the background of continual decline in gaming revenues and a slowdown in the growth of property prices.
Classifying high-end homes as those costing around HK$20 million (US$2.56 million) at current levels, the managing director of Ricacorp (Macau) Properties Limited Jane Liu Zee Ka told media yesterday that she expected prices would likely stay at similar levels throughout the year, with aggressive calls retreating for high-end homes. “I don’t expect a very strong investment sentiment [for high-end homes in Macau] this year. Most of buyers now, or until the first quarter, will be end-users,” Ms. Liu remarked during a press briefing yesterday in a review of property transactions in 2014 and prospects for 2015.
“But then, in the second quarter we’re expecting some new projects [high-end unfinished flats] coming in, [but] I don’t think the price call will be too aggressive when these projects are launched,” the property agency boss said.
The new projects Ms. Liu mentioned include more units for sale from Carat in ZAPE district, La Bahia No.1 and One Penha Hill in Nam Van district, Nova Park in Taipa, One Oasis Cotai South in Coloane and the new housing projects on land plot ‘T’ and ‘T1’ in the Oriental Pearl District in Areia Preta.
Ricacorp Macau noted that they witnessed less luxury home transactions in the second half of last year, a time that they reckoned the slowdown seen in the city’s gaming revenue growth did impact the property investment ambience here.
News emerged in the final quarter of last year that property agents here had noted a cooling down in property investment sentiment with cases of VIP gaming promoters offloading their luxury flats at discounted prices.
Citing market-wide data released by the Statistics and Census Service, the agency noted that there were only 428 transaction cases of unfinished flats - ‘first-hand homes’ - completed in the second half of last year, which represented a fall from the 832 cases in the first half when the launch of about 1,200 unfinished units was concentrated in the period.
Record-breaking price levels of these high-end homes went as high as HK$193,680 per square metre in late March last year, identified as a unit from the Carat project. But the average price of this type of off-plan sale decreased from HK$150,194 in the first half of last year to HK$98,308 in the second half, according to Ricacorp Macau.
More sales, slower price growth
Ricacorp Macau predicts that home transactions for this year will increase to about 8,500 from around 7,200 last year, while the city expects to see approximately 3,000 new homes ready to be occupied.
But the agency also expects slower growth in average home prices here of around 8 per cent to 10 per cent for the year. If Ricacorp’s prediction is correct, it will be a slower growth pace compared to the 20.9 per cent of year-on-year growth seen last year at 100,156 patacas per square metre, according to Business Daily calculations using data from the Financial Services Bureau.
The agency expects more home transactions concentrated in the second half of the year following improved investment sentiment brought about by the completion of new casino-resorts in Cotai.