HONG Kong’s used home prices dropped in the first full week after the city scrapped its property curbs.

Existing home prices fell 0.8 per cent in the week ended Mar 10 from a week earlier, according to the Centa-City Leading Index. The drop comes despite a rebound in home transactions following the policy change. Values are now down more than 2 per cent since the beginning of the year.

As part of its budget released late last month, the city’s government removed measures originally designed to cool housing prices.

Hong Kong’s real estate market has suffered from the worst slump in more than two decades, as high interest rates deter buyers.

While sales volume is now rising, the industry will remain under pressure due to an abundant supply of apartments in both firsthand and secondary markets, as well as expensive borrowing costs, according to analysts.

Colliers International Group expects prices to recover in the fourth quarter when some of the inventory is absorbed.

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In recent launches, property developers have discounted their projects to lure buyers. Wheelock Properties is currently marketing its apartments at a price that is the lowest since 2019 for the area. BLOOMBERG