Residential Real Estate News
Macau's Residential Sales Continue to Decline in 2024
Data from DSF indicate that the housing market transaction volume decreased by 12.7% year-over-year in the first half of the year, while 172 presale homes were recorded during the same period. Following the launch of 'The Zenith' in Taipa, other developers have become more active in launching new projects such as 'YOHO Twins', 'Waterfront Duet', and 'Le Chun Fok'. To boost inventory sales, developers have adopted a conservative pricing strategy for new properties, aligning them closely with secondary market prices.
In the first half of 2024, two projects were issued presale permits, offering 2,072 new homes with a total gross floor area of 238,505 sqm, mainly on the Macau Peninsula.
The residential leasing market continues to be bolstered by strong demand for rental properties from expatriate employees, with new projects offering rental incentives, leading to an increase in the supply of rental properties in the market.
According to the JLL Macau Property Index, rents for luxury residences rose by 0.3% compared to the end of last year, while rents for mass housing increased by 7.4%. However, the performance of assets is trending in the opposite direction, with developers lowering the asking prices of new projects. Prices of luxury and mass residential properties dropped by 4.5% and 3.5%, respectively, in the first half of the year, while investment yields climbed by 1.8% and 2.0%, respectively.
Oliver Tong, General Manager of JLL in Macau and Zhuhai said, "Macau's real estate market experienced significant policy changes this year, including stamp duty reductions, easing luxury property mortgage ratios, and the recent removal of cooling measures. While these actions could potentially restore home sales to healthy levels, they are unlikely to drive home prices higher in the current challenging economic environment. In fact, the home prices correction was exacerbated following the government's decision to lower the maximum loan-to-value (LTV) for first-time buyers, coupled with price cuts in the primary market. Despite the extension of the interest-only repayment option until the year end, Macau's property loan delinquency rate rose to 4.1% in May, a multi-year high. While the market has welcomed the removal of cooling measures, the impact of reducing the down payment mortgage requirement for first-time buyers has been more significant. The government's complex policy changes have further stressed the weak housing market, making it difficult for the market to adapt."
