Why 2014 is a year of "twists and turns" for Hong Kong's property sector

Challenges came up in 2014's second half.

It has been noted that 2014 has been a year of twists and turns for most property sectors, with most segments starting out well but facing challenges towards the second half of the year due to political tensions and social unrest.

According to a research note from Savills, the last  quarter of the year was headlined by Occupy and its adverse impact on the weakening prime retail sector, and yet many primary residential launches over the period received overwhelming responses.

In fact, the 14,707 primary units transacted over the fi rst eleven months of 2014 was a fi ve-year high, while the near HK$160 billion primary transaction value over the same period was a record high, refl ecting the pent-up demand in the market despite the various restrictive measures in place.

Here's more from Savills:

The investment market was also in buoyant mood with major deals being recorded in almost all sectors. In Q4 there were six transactions of over HK$500 million, four of which were billion-dollar deals, as investors were still confi dent of the longterm leasing prospects in different property sectors.

End-users were also keen to purchase properties sooner rather than later amid the recovering leasing market and a shrinking pool of available stock at market prices.

"2014 has been a year of twists and turns for Hong Kong's property sector, with the robust mass residential price rally surprising the market most. While most commercial sectors held up well, the prime retail sector took a hit." Simon Smith, Savills Research.