Commercial real estate services company JLL (Jones Lang LaSalle) has forecast that Macau’s residential property market will remain challenging this year due to a weak external economy, with prices being expected to continue “adjusting”, urging the government to “consider reasonably increasing [the loan-to-value] ratio, accounting for buyers’ affordability, to prevent further economic and property market deterioration”, as outlined in its “Macau Property Market Review and 2025 Market Forecast”.
The report, released on Wednesday, highlights a steady rise in the local residential property rental market, citing its Macau Property Index as pointing out that last year’s rental values for luxury flats increased by 2.5 percent year on year, while rental values for mass residential flats surged by 13.7 percent. In contrast, the asset prices for both high-end and small- to medium-sized residential properties decreased, dropping by 11.4 percent and 9.7 percent year on year, respectively.
Citing figures from the Financial Services Bureau (DSF), the report also noted that “the number of new home sales remained at a low level”, with a transaction volume of 3,057 in the local residential market and pre-sale transactions recorded last year. It added that while new home sales increased in the second half of the year due to the launch of new projects, “this trend was not sustained”.
The report quoted Mark Wong Ka Leong, director of Value and Risk Advisory at JLL in Macau, as saying that Macau’s home prices have generally fallen by more than 20 percent from the market peak, with some flats falling by as much as 30 percent, but pointing out that the market has not seen strong demand in the face of a weak investment climate and an abundant supply of flats available on the housing ladder. He also said that as the price gap between some second-hand private residential flats and the prices of the government’s subsidised home-ownership scheme (HOS) flats offered for sale has narrowed in recent years, the demand for the government’s HOS units has decreased accordingly: “With private housing prices having dropped, they have become more attractive, affecting the demand for economical [subsidised HOS] housing”.
The real estate agency forecast that small- and medium-sized residential asset prices, as well as premium residential asset prices, will continue to decline by 0-5 percent this year, with their rental values being adjusted upwards.
Meanwhile, in terms of the retail property market, the report quoted the agency as noting that it “will likely maintain a polarised trend, with leasing activities remaining active for prime shops in tourist areas, while neighbourhood shops continue to face pressure”.
This file photo taken last year gives a bird’s eye view of part of the city centre. – Photo: Yuki Lei
