Property prices are down, developers to face a tough 2024
Funding costs rise in Hongkong where house prices expected to continue falling
LAHORE/HONG KONG (Web Desk/Reuters) – Property prices is on a decline in Pakistan which shouldn’t be a surprise. Rising inflation, worsening cost of living crisis and shrinking purchasing power mean people have very little or nothing to spare and investment.
However, the case is different for the affluent – elite or upper middle class, the beneficiaries of widening wealth inequality – as the rising inequality since 2018 in general and 2020 in particular resulted in fewer investors or buyers. Initially, the market didn’t understand the long-term consequences of economic, but the results became visible with the passage of time.
Thus, fewer customers resulted in reduced demand and decrease in prices. But this is not limited to home buyers as absence of economic activity means the commercial properties too faced the same situation. So there are not enough businesses which would buy or rent property.
A perfect example of market saturation.
But this trend is worldwide, including Hong Kong which enjoys the status of most expensive place on earth in terms of property prices.
In this connection, Reuters says Hong Kong’s property companies face a squeeze in 2024 from rising funding costs and sluggish home sales and office rentals, making creditors and investors cautious about developers’ financial health.
Some of Hong Kong’s major banks have cut off fresh financing to the city’s highly leveraged or weak property companies, four sources familiar with the matter said, forcing developers to seek more expensive loans in