High interest rates, the global economic slowdown and a slowing economic recovery in mainland China will continue to weigh on the Macau property market, a report by JLL explained.
In its Greater Bay Area Residential Guide, JLL points out that recovery in the region’s housing market remained slow with housing prices expected to remain under downward pressure in 2024.
The real estate agency indicated that the 11 cities in the GBA witnessed uneven recovery in the housing market after the relaxation of cooling measures earlier this year.
‘The mainland cities in the GBA saw a mild and uneven recovery in housing markets, while Hong Kong’s residential market remains subdued. Home sales in Macau rebounded, but the prices continue to fall,’ the report pointed out.
In Macau the property market has been greatly affected by high mortgage interest rates and a significant increase in public housing, leading to a low transaction volume.
The prime interest rate in the Macau SAR has increased from 5.25 per cent in 2022 to 6.125 per cent in July 2023, representing almost a 1 per cent increase in leading rate and the US Fed carried out several rate hikes this year
JLL underlined that transaction volume has remained similar to last year, with a year-on-year decrease of approximately 50.6 per cent, indicating a sluggish market performance.
At the same time, the total transaction volume is expected to increase slightly compared to 2022, driven by price cuts on new projects.
‘Macau implemented adjustments to the property market in November, including stamp duty exemptions and relaxed mortgage loan-to-value ratios for luxury homes, which will help improve the sentiment in the luxury property market,’ the General Manager of JLL Macau, Oliver Tong, says in the report.
The SAR government recently announced a bill that will remove the 5 per cent stamp duty on the