Wednesday, September 30 2020


A 10% drop in residential prices is projected for 2020 as the unemployment rate is forecasted to reach 7%; Investment market remains subdued with 50% of deals in Q3 involving PRC buyers

Update: September, 08/2020 - 09:53

  • Residential transactions in August fell by 29% m-o-m with RVD home prices edging lower by 0.3% m-o-m; another 0.8% m-o-m drop is expected in August.
  • Commercial investment market remained subdued in Q3 with total transaction volumes falling by 64.3% q-o-q.
  • Hong Kong buyers remain subdued, while PRC activity is expected to be more active than local investors.

HONG KONG, CHINA - Media OutReach - 8 September 2020 - The downward trend continued in both the residential and investment markets in Q3 2020 as the pandemic and continuing geo-political uncertainties continued to weigh on sentiment. Despite the challenges, strong pent-up demand, government policy support, economic stimulus packages and the low interest rate environment remain favourable factors that, together, may stabilize the market and induce a rebound by the end of Q3.

Residential transactions declined in Q3 by 6% quarter-on-quarter in both primary and secondary sales markets but recorded a major increase of 30% when compared with Q3 2019. While this indicates that social and economic factors continue to impact the residential market, the unprecedented owner-occupier demand and anticipation of a post-pandemic recovery can be strong stabilizers. Among individual estates, property prices at Taikoo Shing as of August had fallen their lowest level since January 2019 while those in The Harbourside have fallen even further, and are now 10.6% below the previous trough in January 2019. Prices of popular estates are expected to fall further in the near-term.

Mr Alva To, Cushman & Wakefield's Vice President, Greater China & Head of Consulting, Greater China, commented "The secondary sales market has come under severe challenges from the pandemic blow. However, a recent decline in new cases coupled with strong pent-up demand may support a rebound by the end of September 2020. Nonetheless, from a more holistic perspective, with no lasting resolution to either the pandemic or geo-political challenges and with unemployment forecast to reach 7% by year-end, we expect home prices to remain under pressure and likely to conclude the year with an average drop of 10% among popular estates."

The investment market remained subdued in Q3 as local and foreign buyers remained on the sidelines. Year-to-date, a total of 32 major deals (each with a consideration of over HK$100 million) have been recorded, of which just 10 were for commercial property. Despite the fall in demand from local buyers, demand from PRC buyers remained relatively stable, resulting in their accounting for half of the deals concluded in the quarter. Among sectors, industrial was among the most active, supported by purchases of en-bloc building. In contrast, investment into retail, one of the sectors hardest hit by the pandemic, remained muted.

Mr Tom Ko, Cushman & Wakefield's Executive Director, Capital Markets in Hong Kong, said, "With demand for commercial property expected to remain weak in coming months, PRC buying activity should continue to serve as a stable pillar of demand even as many local and foreign buyers continue to take a wait-and-see approach. Nonetheless, based on current trends, both the number of transactions and investment volume in 2020 are expected to fall to a 10-year low."

About Cushman & Wakefield

Cushman & Wakefield (NYSE: CWK) is a leading global real estate services firm that delivers exceptional value for real estate occupiers and owners. Cushman & Wakefield is among the largest real estate services firms with approximately 53,000 employees in 400 offices and 60 countries. Across Greater China, there are 22 offices servicing the local market. The company won four of the top awards in the Euromoney Survey 2017 and 2018 in the categories of Overall, Agency Letting/Sales, Valuation and Research in China. In 2019, the firm had revenue of $8.8 billion across core services of property, facilities and project management, leasing, capital markets, valuation and other services. To learn more, visit or follow us on LinkedIn (

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