Third Quarter 2021 Citi Residential Property Ownership Survey

Fewer respondents expect an increase in property prices

The average age of first-time buyers is 31 years

HONG KONG SAR – Media OutReach – 11 November 2021 – Citi Hong Kong conducted a survey in September 2021 on residential property ownership in Q3 2021. According to survey results:

  • 38% of respondents expected property prices to rise further in the coming year, a lower percentage compared to the previous quarter, but higher than the level in the same period last year.
  • 4% of respondents thought it was a good time to buy a property, a figure that has fallen back to pre-pandemic levels and down from the previous quarter and the same period last year.
  • 13% of respondents expressed interest in property rights, corresponding to the previous quarter. Based on the survey results, close to 320,000 people visited new housing developments in August or September this year.
  • Young respondents aged 21 to 24 expressed the greatest interest in home ownership, with the average age of first-time buyers being 31 years.
  • On average, respondents considered HK $ 5.8 million to be the price of a property that can meet their housing needs, double the price of HK $ 2.7 million estimated 10 years ago.
  • Nearly 60% of respondents who have bought a home within the last 10 years made their purchase decision after visiting five properties, and a similar percentage of respondents decided to buy a property within three months of visiting the first property that came their way. Those who bought a house 10 years ago found it easier to make a home buying decision than their counterparts in recent years.
  • Nearly 70% of respondents who managed to buy a home within the last 10 years did so with financial support from their family, a higher figure compared to ten years ago. With an average of HKD 1.86 million, the amount of financial assistance from the family was also higher compared to 10 years ago.

Nearly 40% of respondents expect property prices to rise in the coming year, and it is estimated that close to 320,000 people will visit properties in August or September this year

Compared with the unusually strong positive mood in the previous quarter, a lower level of optimism about the housing market was registered in the third quarter of 2021, where 38% of respondents expect an increase in property prices in the coming year. However, an average of 42% of respondents expected property prices to rise for the full year 2021, a higher percentage compared to an average of 23% recorded in the previous year. However, the proportion of respondents who considered it a “good time to buy a home now” and expressed “interest in buying a property” – both are indicators of the public’s attitude to the real estate market – fell slightly. In the 3rd quarter of 2021, 4% of respondents thought that now was a good time to buy a property, a decrease compared to the previous quarter and the same period last year. On the other hand, 13% of respondents expressed interest in buying a home, which is a slight decrease of 1% compared to the previous quarter. Estimated based on the survey results, approximately 317,000 people completed property hunts in August or September this year. The overall percentage of respondents who expressed optimism about the real estate market fell from the previous quarter, reflecting a wait-and-see attitude among respondents to home ownership.

Driven by previous expectations of a declining pandemic and a reopening of the economy, property owners may have moved on to buying property early, which has contributed to a particularly positive outlook for the real estate market among respondents in the previous quarter. The real estate market may have experienced a restructuring in this quarter, after seeing a premature release of the purchasing power of the local population, and transaction volume may fall. In light of the temporary impact of other macro factors, including uncertainty in the recent stock market sentiment and wealth effects, citizens’ prospects for the real estate market may be affected in the short term. That said, the local real estate market continues to be supported by positive structural factors such as undersupply and long-term economic growth by reopening the border.

The average age of first-time buyers is 31 years, with an estimate of HK $ 5.8 million as the average price of a property that meets respondents’ housing needs.

The survey also examined respondents’ views and experiences regarding home ownership. It turned out that young respondents aged 21 to 24 were most interested in home ownership, with the average age of first-time buyers being 31. Respondents set the average price of a property that could meet their housing needs at HK $ 5.8 million, 115% higher than the price of HK $ 2.7 million estimated 10 years ago, reflecting the rising trend in property prices during this period. Respondents who bought a home 10 years ago found it easier to make a purchase decision compared to their counterparts in recent years. 58% of respondents who bought a home in recent years made their purchase decision after visiting five properties, and 58% of respondents decided to buy a property within three months of visiting the first property that came their way. 70% of respondents who bought a home 10 years ago made their purchase decision after visiting five properties, and 68% made their purchase decision within three months of visiting the first property that came their way. On the other hand, 67% of respondents who had bought a home for the first time in the last 10 years said they did so with financial support from the family, a figure that is 15 percentage points higher compared to 10 years ago. The amount of family assistance has also increased from an average of HK $ 500,000 a decade ago to the current HK $ 1.86 million.

How do you think house prices will develop in the next 12 months?

Percentage of respondents

3rd quarter 2020

Q4 2020

1st quarter 2021

2nd quarter 2021

3rd quarter 2021

Up

23%

22%

33%

54%

38%

Flat

34%

43%

47%

35%

37%

Downward

43%

36%

20%

12%

25%

If you do not own any property now taking into account your current standard of living and family finances, do you think this is a good time to buy a house now?

Percentage of respondents

3rd quarter 2020

Q4 2020

1st quarter 2021

2nd quarter 2021

3rd quarter 2021

A good / an excellent

time to buy

10%

8%

7%

7%

4%

Neutral

36%

39%

37%

38%

41%

A bad / terrible

time to buy

54%

54%

56%

55%

55%

How interested are you in buying a home now?

Percentage of respondents

3rd quarter 2020

Q4 2020

1st quarter 2021

2nd quarter 2021

3rd quarter 2021

Much / rather
interested

17%

17%

17%

14%

13%

Neutral

28%

27%

29%

28%

33%

Much / rather
uninterested

55%

56%

54%

58%

54%

“Survey results show that local citizens had a wait-and-see attitude towards the real estate market in Q3 2021,” said Josephine Lee, head of retail banking at Citi Hong Kong. “Almost 40% of respondents expected property prices to rise in the coming year. The proportion of respondents who considered it a good time to buy a property has fallen slightly compared to the previous quarter, and the proportion of respondents who have expressed interest in buying a property has also fallen a slightly compared to the previous quarter. The younger respondents were more interested in buying a property where the average age of first-time buyers was 31. The price of a property that the respondents considered suitable to cover their housing needs has doubled in 10 years. We recommend that young people who are interested in buying a property begin to review their asset allocation as soon as possible, accumulate their wealth and gradually be empowered to realize their expectations for home purchase. Other potential homeowners should also thoroughly assess their financial situation and seek an appropriate mortgage plan to fulfill their dream of home ownership. “

Citibank commissioned the University of Hong Kong Social Sciences Research Center to conduct the survey and interviewed a random sample of more than 500 Hong Kong respondents by telephone in September 2021. Since 2010, Citibank has conducted quarterly surveys of the Hong Kong housing market to assess the current state of home ownership in SAR, measure public intentions about home ownership and track public expectations of future home price trends.

Source: Citibank Q3 2021 Residential Property Ownership Survey

Please download the mortgage survey photo from the press conference here.


About Citi

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Further information can be found at Third Quarter 2021 Citi Residential Property Ownership Surveywww.citigroup.com | Twitter: @Citi | Youtube: www.youtube.com/citi | Blog: Third Quarter 2021 Citi Residential Property Ownership Surveyhttp://blog.citigroup.com | Facebook: www.facebook.com/citi | LinkedIn: www.linkedin.com/company/citi

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