Real estate index indicates that the Hong Kong property market has fallen

In recent weeks, the impact of social violence has escalated, and the decline of Hong Kong stocks has not stopped

Among them, the Hang Seng Real Estate Sub-Index has further expanded to 20% during the year and officially entered the bear market, indicating that the overall real estate market will be adjusted. In fact, individual property rentals fell by as much as 30%, reflecting the downward pressure on office buildings and shopping malls.

In September, the pressure on Hong Kong stocks has increased. The Hang Seng Index fell more than 200 points yesterday. It closed down to about 100 points, down about 0.3%, and stayed at 25,600. point.

Tired 20% into the bear market

However, the Hang Seng Real Estate Sub-Index fell more than the overall market, and the decline was only 1.5% yesterday. In fact, from the high level in April this year, the Hang Seng Property Sub-Index rushed from the high of 46,000 to the current 36,000. The accumulated decline has exceeded 20%, and the Hang Seng Index has fallen more than the same period. Big.

As the property index has a leading indicator, it indicates that the Hong Kong property market will be adjusted. Whether it is residential property prices or industrial and commercial property rents, it is subject to considerable downward pressure. The potential decline may exceed the 2008 and 2009 financial tsunami.

The rent-receiving stocks fell the most scary

First of all, the Hang Seng Real Estate Sub-Index is hard to say in the short term. At present, the real estate index predicts that the P/E ratio has dropped to nine times. However, it has not seen the large amount of funds entering the market. It is obvious that the market is worried that the impact of social violence will continue and will have a far-reaching impact on the economy, which may shake Hong Kong’s status as an international financial center.

After Alibaba postponed its listing in Hong Kong, Saudi Aramco also abandoned Hong Kong’s choice of Tokyo as a listing place. Therefore, there is reason to believe that the rental and sale prices of residential and industrial and commercial properties are subject to deep adjustment.

Second, foreign banks have lowered their investment ratings on real estate stocks. Although property stocks have fallen by an average of 20% from a high level, JPMorgan believes that property stocks have not yet reflected uncertainties. Concerns about continued violent shocks have caused tourism consumption and local consumption to fall by 70% and 10% respectively, dragging down overall retail sales in Hong Kong. A significant drop of 30% constitutes a considerable adjustment pressure on real estate stocks. Real estate rental stocks, such as Wharf Real Estate, relying on rental income from office buildings and shopping malls, this year’s share price has fallen by 30% from a high level, and the decline is very scary.

In fact, in the case of office buildings, the overall office rent in Hong Kong is 160% higher than that in Singapore. If the society continues to be unstable, there may be foreign companies withdrawing from Hong Kong, causing office rents to drop by 20% to 30% at any time.

Property prices fell more than tsunami

Third, real estate stocks led the decline in the stock market, with a general decline of 20% or more, indicating that the overall residential property prices will fall sharply. According to the latest data from the Rating and Valuation Department, the property price index fell for two months, but the decline was less than 1%. However, the real economy has turned sharply and the unemployment rate has bottomed out. It is expected that the decline in residential property prices will gradually increase.

Judging from the significant reduction in eye-catching funds and the entry of property stocks into the technical bear market, the adjustment of residential property prices in Hong Kong is not a small one, which will be higher than the 17% decline during the financial tsunami.


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