Trump-xi G20 Meeting Gives Hope to Markets

- Executive Director, Century 21 Hilltop Property Agency

Just when the recent protests had many worried about the future of Hong Kong's property market, good news came in the Trump-xi G20 meeting. Savvy investors have started making moves in the stock market as early as mid-june, and some are already making huge profits. Meanwhile, large amounts of funds have been directed into the bonds market, resulting in a sharp dip of bond yields. If this ends up leading investors back to the housing market, it's reasonable to expect Hong Kong's home prices to rebound in the near future.

On the other hand, the US Federal Reserve recently raised the prospect for potential rate cuts this year, signaling an end to rate hikes. Some experts even predicted that the US government may start a new round of quantitati­ve easing soon. Although it doesn't mean that Hong Kong interest rates will experience synchronis­ed adjustment­s, it does dispel worries previously held by home seekers about more interest rate hikes.

With the market warming back up, local developers are quick to respond with new housing projects set at reasonable price points, indicating a clear intention to sell them well and fast. According to early reports, the four major new developmen­ts that recently opened for applicatio­ns have all been met with a lot of buyer attention.

For those determined to become home owners soon, don't wait until after trade conflicts are resolved—by then, home prices would have reached new heights, so make the purchase now. Even if the Trump-xi talks break down and continue to negatively impact the housing market, paying mortgage at a low interest rate is still better than paying rent to live in someone else's property.

A large portion of Hong Kong's current social problems and tensions are rooted in public anger towards the city's miserably insufficie­nt housing supply and sky-high home prices that few can afford. For many Hongkonger­s, protest is a way to channel this resentment and express their dissatisfa­ction, loudly and publicly. The government should take a cue from the recent rallies and refocus on increasing land and housing supply. Only by tackling the issues at the root can our leaders guide our city on a path of economic prosperity and political stability.

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