Lok Wai Dak: Property Market Tuned Down by 12-15%

Macau’s economy is slowing down as the government steps up its macro-control of the development of the gaming sector, and the mainland tightens its FIT Scheme. Lok Wai Dak, Executive Vice President of Real Estate Association of Macau, says that the local property market has entered an adjustment period. As the economy slows down, property prices will drop by 12-15% in the second half of the year. And this adjustment seems to coincide with that on the mainland, he believes that the period will not last longer than one year, and it will cease at the end of the year, so property prices will not fluctuate unduly.

According to Lok, property transactions grew by 30% annually between 2003 and 2007, and property prices also rose by some 30% annually. As of now average new properties are priced at MOP2,500 per square foot or more, while high-end properties between MOP6,000-8,000. Although the market has been under external economic influences this year and the property market is in adjustment, residential leasing market remains buoyant and as a result average property prices actually fall between 5-8%. In this backdrop, prices of an average residence in Taipa and high-end residences register a more marked fall, with some high-end residences by more than 15%, while those in Macau remain largely intact.

As the market of Macau keeps expanding, its labour force keeps growing. The key elements of the property market are in place – demand and brand products. The builders and developers in Macau now have a better knowledge of branding and understanding of the market.