Home prices up by 19% YOY in 1Q15, Hong Kong ranked the top of Global House Price Index
Knight Frank released the latest Global House Price Index for Q1 2015 showing the slowest growth of home price among 56 major cities worldwide in three years, Y/Y growth of 0.3% in March was recorded. However, HK still led the rank by stunning price surge of 19%.
Although the Hong Kong Monetary Authority (HKMA) tightened credit requirements for homes loan valued in February, rise of home prices continued. Residential estate gained another 3% in early June to end of February. According to the Hong Kong Rating and Valuation Department, residential property prices have been increasing since May 2014.
HK government will implement further cooling policies or relax those existing cooling measures to cool down the rising home price, and are concerned that potential US interest rate hike by the US Federal Reserve may drag the local property market to normal.
Secretary for Financial Services and the Treasury Ceajer Chan Ka-keung added the government is not considering taking additional steps to cool the market.
While it is believed the Fed will not hike interest rates this month, Chan is optimistic it will happen this year, adding Hong Kong will likely follow suit.
Meanwhile, Macquarie issued a report saying the HKSAR government may implement measures to cool the housing market, given the US did not increase interest rates as expected.
Property prices are 1.5 times higher than those in 2010. The bullish market pushed the price up for the 13th straight month, up 7.2 percent when compared with early this year.