HK’s Richest 2019: Correction Fears Spook Property Markets

15-Feb-2019 Intellasia | Forbes | 6:00 AM Print This Post

Over half of Hong Kong’s fifty richest owe their fortune to real estate, seven of whom are among the top ten wealthiest billionaires in the city’s rich list. Higher interest rates and the US-China trade war are sending tremors through Asia’s priciest property market that stand to hit them hard. The most recent sign of trouble came in August last year: after racking up HK$403.7 billion ($51.5 billion) worth of transactions in the first half, sales started to slow in August for the first time in 28 months. Then in December, property sales fell 58 percent from the same month in 2017 to the lowest in 28 years, according to local property broker Midland Realty. Residential prices have now dropped 7 percent since peaking in July, according to data from Hong Kong’s Rating and Valuation Department.

Fears of a looming correction have been weighing on shares of Hong Kong’s big developers. Chinese Estates Holdings, which counts billionaire Joseph Lau and his family as its biggest shareholder with a 75 percent stake, was the hardest hit, tumbling roughly 33 percent in the year to December 2018. In July, it announced unrealised losses of more than HK$900 million on investments including its 6.5 percent stake in mainland developer China Evergrande Group. Shares of Lee Shau Kee’s Henderson Land Development and Peter Woo’s Wheelock Properties both declined at least 18 percent in the year to December 2018. Li Ka-shing’s CK Asset Holdings, Lui Che Woo’s K. Wah International Holdings and the Kwok family’s Sun Hung Kai also weren’t spared, dropping more than 13 percent in the same period.


Category: Hong Kong

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