Ready Go! 

At least three new projects, featuring over 1,300 flats, could become available for sale in the second half of 2020 over a stable market outlook albeit the coronavirus’ economic damage 

Scenes of queues for flat viewing and a chance to snap up flats in new projects in recent weeks amid a global pandemic have given developers a much-needed confidence boost, and, according to market insiders, more first-hand sales are in the pipeline in the second half of this year in view of the continuous recovery of the property market.

According to the Financial Service Bureau, a total of 2,083 houses were transacted in the first five months of 2020, declining by 33 percent from the same period a year ago, while the transaction price in the January-May period this year averaged MOP99,878.9 (US$12,484.9) a square metre, down by 7 percent from MOP106,394 a square metre a year earlier. 

But the May data indicates a rebound in the real estate sector, clouded by the outbreak of the novel coronavirus (COVID-19) since earlier this year. The monthly tally of residential transactions in May reached a seven-month high at 624, albeit still 39.1 percent lower than a year earlier. The average transaction price also hit a six-month high at MOP106,394 a square metre in May, despite a year-on-year decline of 6.9 percent.

This revival has been particularly driven up by the latest rounds of first-hand sales in a number of high-end residential projects across the territory. YOHO: Cotai Marina Bay, a 388-unit residential complex opposite to the integrated gaming resort Galaxy Macau in Cotai; Praia Park, a project of about 1,850 flats in 12 towers in Seac Pai Van; Avenida, comprising over 330 flats in the NAPE district; Pride Oceania, consisting of nearly 500 flats at Rua dos Pescadores in Areia Preta; and others have launched new rounds of first-hand sales since mid-April.

No. of flats available in high-end residential project Trust Leisure Garden 

Y-o-y decline in no. of home transactions in Jan-May

Enthusiastic response 

“These first-hand sales overall have met with an enthusiastic response, as developers have rolled out various incentives, including a stamp duty rebate, a long transaction period, steep discounts for car parking space purchase, and others,” says Jane Liu Zee Ka, managing director of Ricacorp (Macau) Properties. 

“For instance, YOHO: Cotai Marina Bay and Waterfront Duet have recorded sales of about 100 units each in recent weeks,” she illustrates. Waterfront Duet, a project boasting about 1,000 flats near the Macau Yacht Club in Fai Chi Kei, has launched various rounds of sales since the end of 2018.

Trust Legend, another residential project featuring about 340 flats, including over 180 studio flats and more than 100 one-bedroom units, launched the third round of sales in May, which has attracted over 10,000 flat viewings, said its developer Trust Construction and Investment Company Limited. Over 80 percent of an unspecified number of flats available in the third round have been sold, the seasoned developer has said, which has developed over 100 commercial and residential projects here over the past three decades and more.

Ms. Liu adds though the sentiment in the market has quieted down in June due to the absence of first-hand sales, she believes it will pick up again in later summer when developers put up more apartments for sale.

The Three

According to sources in the market, it is expected that some projects that have never launched sales before will debut in the second half, in addition to projects like YOHO: Cotai Marina Bay, Praia Park, Grand Oasis, an extension of other existing luxury home projects One Oasis and Sky Oasis developed by Concordia, and others that will have new rounds of first-hand sales.

One of them is Trust Leisure Garden (信步閒庭), located at a 7,409-square-metre land plot at Avenida Marginal do Patane in Fai Chi Kei. The project, developed by Trust Construction and Investment as Trust Legend, has been completed with an occupation permit issued by the government. 

However, the developer has not officially launched any sales yet, except starting to lease its private car parking space since last year, while a public car park of 520 parking spaces within the two-tower complex has been opened to the public since late 2018. Market insiders indicate Trust Construction and Investment might finally launch home sales this year. According to the Land, Public Works and Transport Bureau, the development features 740 flats, including 600 studio units and 140 one-bedroom flats. 

Another new project is a yet-to-be-named high-end residential complex at No.527-553 Avenida do Dr. Rodrigo Rodrigues, next to the Chinese liaison office building. The project — a 33-storey residential tower boasting 481 flats, including 400 studio units — is developed by Sunnyville Property Development Company Limited, which is linked to entrepreneur Cheong Lok Tin. Mr. Cheong is the chairperson of San You Development Co. Ltd, a seasoned developer for numerous local luxury residential projects, including The Residencia Macau in Areia Preta; The Manhattan in Taipa; and Avenida that is opposite to the unnamed project.

The project on Avenida do Dr. Rodrigo Rodrigues has had a pre-sales permit issued by the authorities since 2018, but the developer has not put it up for sale as of now, concerned about cannibalisation with Avenida, say market sources. With most units in Avenida successfully sold out, the developer might finally roll out that unnamed project after this summer, possibly in the fourth quarter of this year, they say. 

Chun Fok Penha (泉福半山), boasting 102 homes at Travessa do Bom Jesus on Penha Hill, was originally scheduled for the launch of sales last year, but the developer — San Hei Lei Investment and Development Co Ltd, linked to Ho Chun Kei Construction and Investment Co Ltd, one of the leading developers in the city — has so far kept it on hold. Market insiders say this high-end project is also likely to become available in the second half.

“From the trade war between China and the United States, to the pandemic of COVID-19, they all have put downward pressure upon the property market — but the negative impact so far has been short-lived,” says Lily Hong, sales director of Midland Realty (Macau) Ltd.

Low interest rate

The market outlook, which will play a big part on how local developers plan their next move for the remainder of the year, is expected to be stable. Despite the lingering impact from the global pandemic, Roy Ho Siu Hang, director of real estate agency Centaline Macau, says low borrowing costs due to the latest policy initiative by the United States Federal Reserve will keep people interested in the local home market. 

The Fed said in June, after several urgent rate cuts earlier this year, that it sees the interest rate remaining at close to zero level lasting through 2022 to curb the coronavirus’ economic damage. As the city’s currency, pataca, is indirectly pegged with the U.S. dollar through the Hong Kong dollar, it is expected that commercial banks in Hong Kong and Macau will follow suit in terms of the interest rate policy.

“From the trade war between China and the United States, to the pandemic of COVID-19, they all have put downward pressure upon the property market — but the negative impact so far has been short-lived,” says Lily Hong, sales director of Midland Realty (Macau) Ltd.

“The recent pandemic might have affected the earnings of some, particularly those in the gaming and tourism industries, making them less willing for home purchases,” she continues, “but with the imminent opening of borders and the gradual lifting of travel restrictions, the local economy has shown signs of recovery so has been the property market.”

With the monthly residential transactions standing at about 416 in average in the first five months of this year, Ms. Hong forecasts the number of monthly transactions could maintain at about 500-600 in the second half, and probably hit the level of 700-800 in September and October respectively over surging first-hand sales. “The home price for the entire year will probably end up with single-digit correction,” she adds.