Completion of flats to reach 15-year high in the Year of Dog

Up to 24,000 private residential units are projected to be completed in 2018, the highest number recorded since 2003. 

February 28, 2018

HONG KONG, February 28, 2018 – Up to 24,000 private residential units are projected to be completed in 2018, the highest number recorded since 2003. Still, Hong Kong's property market is expected to remain resilient running into the new year riding on upbeat sentiment and sustained housing demand stemming from gains in the stock market and a stable economic outlook, according to JLL's latest Residential Sales Market Monitor.

The majority of the completions is likely to be dominated by mass units; over 85% of the units will be less than 1,075 sq ft, SA. By territory, JLL anticipates that the five supply hotspots will primarily be located in Kowloon and the New Territories, namely Tseung Kwan O, Tsuen Wan, Kai Tak, Cheung Sha Wan and Ma On Shan.

So far, only nine out of 28 residential sites in the Government's 2017-18 Land Sale Programme have been released and sold, yielding a mere 3,000 units as opposed to the potential land supply of 18,900 units if all earmarked sites were to be sold. In anticipation of the next land sale programme scheduled on March 1, JLL believes both local and mainland Chinese developers would foreseeably remain as active bidders given the recent land bidding trends, fueling bids to fly even higher in the months to come.

Henry Mok, Regional Director of Capital Markets at JLL, said: "Most of the flats scheduled for completion in 2018 have already been sold over the last two years. Including the pre-sale consent projects planned for launch this year, there will be about 20,000 new flats available for sale in 2018. As we expect the flats to be easily absorbed by the market, the new supply is unlikely to exert downward pressure on property prices. As such, the market outlook remains positive, especially as expectations of rising interest rates have already been largely factored into purchase decisions."

Ingrid Cheh, Associate Director of Research at JLL, said: "Mortgage rates in Hong Kong have remained at relatively low levels even though the US Federal Reserve lifted the interest rate by 25 basis points last December. Factoring in the additional rate hikes in 2018, we maintain our view that higher costs of financing, if materialized, are unlikely to have much of a tilting effect on buying sentiment."

Separately, JLL figures show that as of end-January 2018, JLL Mass Capital Values Index has increased by 0.9% m-o-m and 16.2% y-o-y, with the potential to climb about 10% in 2018.

About JLL

JLL (NYSE: JLL) is a leading professional services firm that specializes in real estate and investment management. Our vision is to reimagine the world of real estate, creating rewarding opportunities and amazing spaces where people can achieve their ambitions. In doing so, we will build a better tomorrow for our clients, our people and our communities. JLL is a Fortune 500 company with annual revenue of $16.3 billion, operations in over 80 countries and a global workforce of over 90,000 as of December 31, 2018. JLL is the brand name, and a registered trademark, of Jones Lang LaSalle Incorporated. For further information, visit