New housing prices in Hong Kong stabilize at high levels in December, developers stick to the strategy of "high price destocking"!

According to comprehensive property platform data, the average asking price for new-build properties in Hong Kong in December stood at HK$196,000 per square metre, remaining unchanged month-on-month. Among the top ten most sought-after developments, only BlueCoast openly quoted HK$240,000 per square metre, with prices for the remaining projects remaining stable. This trend underscores Hong Kong developers' core strategy of ‘depleting inventory at premium prices’ rather than indiscriminate price hikes, echoing the cautious approach seen in Vanke's suspension of sales for Tai Po's ‘Lianhao Phase II’.

Year-end traditionally marks a key sales window for the property market, where price stability serves as a barometer of market sentiment. The current high-level price stabilisation has defied expectations of ‘price hikes driven by market recovery’. The core reason lies in the current market's moderate and unstable recovery. Developers harbour concerns about the sustainability of purchasing power and dare not rashly raise prices. Simultaneously, with limited unsold inventory in the property market, developers hold the pricing initiative, making ‘high-priced inventory clearance’ the optimal choice to balance profits and sales.

Specifically, price differentiation among the top ten popular projects remains minimal. Only BlueCoast has adopted a clearly elevated pricing strategy, with all others maintaining ‘prices unchanged’ – confirming developers' caution. In a market yet to fully stabilise, sustaining high prices safeguards profits and avoids market panic triggered by price fluctuations. Popular projects, leveraging their location and product advantages, attract core clientele without needing price adjustments.

Notably, this price stabilisation aligns with Vanke's decision to postpone project launches – both reflecting developers' balancing act between ‘improving market conditions’ and ‘manageable risks’. This collective caution demonstrates developers' precise market assessment while profoundly shaping Hong Kong's property trajectory.

For the market, ‘high-priced destocking’ may temporarily delay sales clearance but helps stabilise prices and prevent sharp fluctuations. For buyers, price stabilisation means manageable entry costs without fear of price hikes, though rational assessment of value for money remains essential to avoid impulsive purchases.

Looking ahead, market focus will centre on the practical outcomes of this high-priced inventory clearance strategy: steady sales of popular projects will bolster developers' pricing confidence, while poor performance may prompt promotional adjustments. The launch pace and pricing of additional new developments towards year-end will also serve as key indicators for the property market trajectory in early 2024. Industry insiders advise prospective buyers to make rational decisions based on their needs, prioritising high-quality projects. Developers should monitor demand shifts and flexibly adjust their launch schedules to avoid missing opportunities.