Hong Kong's supply of first-hand private residential properties continues to decrease, while the supply of resale properties significantly drops.

With the decrease in land sales, the supply of first-hand private homes in Hong Kong is expected to trend downwards in the next 3 to 4 years. According to the latest data released by the Hong Kong Housing Authority on "first-hand private residential market supply", the first-hand supply in the next 3 to 4 years (including land that has been approved for development and can start construction at any time (known as "mature land"), unsold units in completed buildings (known as "unsold stocks"), and units under construction that have not been sold) recorded a total of 105,000 units in the first quarter of this year, a decrease of 2000 units per quarter, marking a continuous decline for 4 quarters and reaching a new low for 7 quarters. The latest figure is about 7000 units lower than the record high of 112,000 units in the first quarter of last year, representing a decrease of about 6.3%. Louis Chan, Chief Analyst at Centaline Property, pointed out that the decline in new supply of first-hand private homes in Hong Kong on a quarterly basis is mainly driven by a decrease of 3000 units in unsold units under construction, reaching a new low of 65,000 units in 2 years. While there were many new property launches in the first quarter and achieved good sales performance, at the same time, about 5500 units were completed in the first quarter, resulting in a decrease in unsold units under construction. The supply of mature land, which refers to land that has been approved for development and can start construction at any time, recorded 12,000 units in the first quarter of this year, remaining unchanged from the previous quarter. With the decrease in land sales in recent years, the supply of mature land has significantly declined, hovering between 10,000 to 13,000 units in the past 4 quarters, a substantial decrease compared to the 25,000 to 29,000 units in the first three quarters of 21 years ago. It is worth noting that the potential land supply for the fiscal year 2025 is at a record low of 15 years, and it is estimated that developers will actually absorb less land in this situation. Therefore, land supply will gradually decrease, and the supply of mature land will continue to decline.