According to the latest issue of RLB Construction Cost Update HK Report, it is projected that the tender price index will remain relatively stable in the coming quarters.
In the second quarter of 2024, the Hong Kong economy continued to exhibit moderate growth while real estate investment market quietened progressively. The construction industry demonstrated growth with 16.0% increase in building and construction expenditure. This growth was predominantly driven by the public sector, contributing to a substantial 35.8% increase.
The Government has taken a prudent and paced approach in its recent land sale program, unveiling a single residential site for the second quarter. This residential site located in Sha Tin is projected to yield approximately 570 units. In conjunction with Urban Renewal Authority’s initiatives and various private development projects, the total private housing supply for the first half of the year is forecasted to meet around 30% of the annual target. The Government has also rolled out one large industrial site in Hung Shui Kiu, in line with the proposal in the Northern Metropolis Development Strategy, to support the development of multi-storey industrial buildings and logistics centres.
In view of the current economic landscape, property market sentiment turned increasingly cautious. Local professional institutions had suggested government to expedite additional public projects and establish a consistent land supply timetable given the existing circumstances. Adjustment of land sale strategies and streamline of private development approval procedures are recommended to encourage developers’ investments. In terms of the global dynamic, uncertainties such as geopolitical tensions and fluctuations in the economic continue to pose concerns. It is anticipated that the tender price index will remain relatively stable within a narrow range over the next few quarters.
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