Outlook over the Asia-Pacific region’s residential markets
The market is growing despite the global economic slowdown
Knight Frank has released a market report about the residential sector in the Asia-pacific region, underlying that the residential markets are growing despite the global economic slowdown.
The uncertainty in the world economy, the ongoing Eurozone crisis and the sluggish recovery in the US have made the Asia-Pacificl more appealing to investors who trust hard assets in the form of property. In Q2 2012, Hong Kong saw its strongest quarterly growth since 2009. Price grew in the affordable segment of the market in many Chinese cities. India’s market continued to expand and the performance of the Indonesian residential real estate continued to be solid.
In China, eyes are now on the handover in power, to see if the new leadership lifts the property cooling measures given the slowdown.
The increase in price in Hong Kong has been met by government policies to cool the market. New restrictions have been announced, which could reduce credit to the sector and slowdown prices through the remainder of 2012. A number of record transactions have been registered in the market. A unit was sold for 87,844 US dollars per square metre, putting the area among the most expensive zones in the world.
The market of Malaysia is expected to remain steady through 2012. Singapore has seen record volumes transacted and further price increases are expected in 2012. Indonesia’s strong performance continues. In Q2 2012, house prices increased by 1.2% across the country. Strong fundamentals make confidence in the development market remain strong.
In Thailand, price performance of the Bangkok condominium market is expected to polarize between city centre and periphery locations. More price competition is expected on the periphery, where there is a large supply in the market. In the city area, instead, there will be more upward price pressure due to the more limited supply available.
The market of Vietnam is likely to continue to be troubled, as the slowdown in the economy will continue to put downward pressure on residential prices.
The Australian market continues to be affected by the Chinese slowdown even if a number of recent government incentives introduced in various states have increased opportunities for first-time buyers.
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