Merrill Lynch: Restarting the interest rate cut cycle boosts the atmosphere of the Hong Kong property market, expecting residential transaction volume to rise in the fourth quarter, with new projects benefiting first
On Wednesday local time, the Federal Reserve announced a significant 50 basis point rate cut, the first rate cut in over four years, lowering the target range to 4.75% to 5%. Bruce Lee, Executive Director of the Residential Department of Federal Properties, stated that the Federal Reserve's latest interest rate decision to cut rates by 0.5% at once is the first rate cut for the United States since March 2020. The rate cut not only exceeded expectations but also indicates the possibility of further rate cuts later this year. He believes that the restart of the rate cut cycle will definitely help boost the atmosphere of the Hong Kong property market, with residential transaction volume expected to increase in the fourth quarter. New developments are expected to benefit first, with the volume of first-hand transactions in the fourth quarter expected to reach 4,700 units, an increase of about 80% from the estimated 2,600 units in the current quarter. He mentioned that it is even more significant that major banks in Hong Kong have unexpectedly cut rates by 0.25%, and with the rate cut cycle starting, it is believed that there will be a flow of funds into other investment sectors. Currently, Hong Kong property prices have dropped nearly 30% from their peak, coupled with sharp increases in rents, making them highly attractive for both personal use and investment
According to the Wisdom Financial APP, on Wednesday local time, the Federal Reserve announced a significant 50 basis point rate cut, the first rate cut in over four years, with the target range lowered to 4.75% to 5%. Bruce Lee, Executive Director of the Residential Department of the Federal Union Property, stated that the Federal Reserve's latest interest rate announcement, a one-time rate cut of 0.5%, is the first rate cut for the United States since March 2020. The rate cut not only exceeded expectations, but there is also a possibility of further rate cuts this year. He believes that restarting the rate cut cycle will definitely help boost the atmosphere of the Hong Kong property market, with residential transaction volume expected to increase in the fourth quarter. New developments are expected to benefit first, with first-hand transaction volume expected to reach 4,700 units in the last quarter, a significant increase of about 80% compared to the estimated 2,600 units for this quarter.
He mentioned that more importantly, major banks in Hong Kong have also unexpectedly cut interest rates by 0.25%. With the start of the rate cut cycle, it is believed that there will be a flow of funds into other investment sectors. Currently, Hong Kong property prices have fallen by nearly 30% from their peak, coupled with sharp increases in rents, making them highly attractive for both personal use and investment