6 May 2015 - As an important holiday for Hong Kong’s tourism industry, the May “Golden Week” has regularly filled the city with tens of thousands of mainland tourists along with billions of cash ready to flow into the Hong Kong real estate market. This year, the number of mainland tourists continued to rise despite the newly implemented “one-visit-per-week” policy. The property market, however, remained quiet, resulting from the continued impact of the Buyer’s Stamp Duty (BSD) which constrains non-Hong Kong permanent residents and companies from speculative investment. This has led to a drastic 95% reduction in the number of flat-viewing tours.
According to Centaline, the Golden Week in May and the National Day holiday in October are usually peak seasons for real estate agencies and developers. Viewing tours used to draw at least 100-200 groups of deep-pocketed mainland buyers to their new launches before the BSD was imposed. For example, 10-15% of the flats sold in Lohas Park Phase 2, Tseung Kwan O, are registered under Chinese buyers.
Analysts believe that the trend is likely to continue given that the government shows no signs of relaxing the tightened regime in the near future. Recent local protests against mainlanders and the PRC government’s anti-corruption campaigns are also considered as important factors contributing to the severe drop this year.
