RICS Global RE Weekly: Hong Kong Commercial Property Enters 'Double Dip'

Royal Institution of Chartered Surveyors
2009-03-13 12:38 665

HONG KONG, March 13 /PRNewswire-Asia/ -- The latest figures on the Hong Kong economy are due next week with the release of both unemployment data on Tuesday 17th and inflation on Friday 20th. The release of the unemployment rate is a key indicator for the commercial property market. Labour market figures tend to move in tandem with rental developments across the commercial property market.

Unemployment jumped in the three months to January from 4.1% to 4.6%. RICS expecting this trend to continue through 2009 as a global trade recession and rationalisation pressures across the global financial services industry weigh heavily on the labour market.

The latest RICS Global Commercial Property Survey suggests that the Hong Kong commercial property market has been one of the most affected by the downturn in the global economy in Q4. Lettings demand for property plummeted across all three sectors of the market, sending availability higher for the second consecutive quarter. Respondents expect prices to fall at a faster pace in the coming months compared to 6 months earlier as declines in rents accelerate in pace.

Credit not the only problem for US commercial property

There's no doubt that the Fed has its work cut out preventing a complete collapse in economic growth. At the next meeting, on Tuesday 17th and Wednesday 18th, they are likely to reiterate their commitment to "employ all available tools" to aggressively fight the current downturn.

Russian downturn takes its toll on property development

A further indication of how the Russian economy is faring in the face of the deepening global crisis will be provided by the release of industrial production data for February on Wednesday 18th.

Irish house price correction has further to run

Irish house price data for February is due for release on Monday 16th (by permanent tsb and the Economic and Social Research Institute). Average house prices have been falling in every month since March 2007 and at euro 258,005, they are now 17.1% below their peak.

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Source: Royal Institution of Chartered Surveyors
Keywords: Real Estate