Millennial Investor Victor Ng: Housing Prices May Drop More Than 10% This Year

The economic uncertainties brought on by the COVID-19 pandemic have created a legion of market pessimists. Amongst them is post80s property investor Victor Ng, who believes that Hong Kong's housing market will be “out of luck” for the next couple of years, and that housing prices may drop 15-20% this year and possibly a further 20% next year. “The economy has entered a downward cycle and is extremely unlikely to climb out of it in just six or 12 months. So I think the housing market will stay sluggish in the next two years,” he says.

Ng further opines the Hong Kong economy— which is heavily dependent on the finance, service and tourism sectors—is struggling so badly amidst the pandemic that even stimulus measures from the Chinese government may not help. He adds that with many businesses already closing down and people losing jobs, the unemployment rate will continue to rise, and in turn have a severely negative impact on the housing market.

Homebuyers Might Want to Stay Put for Now

Based on the city's weakened economy and his belief that the housing market will stay stagnant in the next two years, Ng doesn't think that buying properties for investment is a wise move right now. However, for those in need of a home for personal use, Ng admits that the market is currently offering some rare opportunities to snap up great bargains. If you find an ideal property, Ng suggests to try negotiate the price down 10-20% and carefully weigh your risks (for example, how likely you're going to become unemployed or experience financial difficulties), and if everything checks out, you can consider buying the property. That said, if you can wait just a little longer, Ng still believes that late 2020 or early 2021 will be an even better time to buy, predicting that home sellers will be more willing to negotiate by then.