[ET Net News Agency, 23 November 2018] Daiwa Research believes the prevailing investor
sentiment on the HK residential property market is overly bearish and opportunities
similar to those in early 2016 could emerge again for HK property stocks.
The research house reiterated its view that the government measures imposed since 2011
has suppressed transaction volumes and resulted in a situation of shrinking volume in the
secondary market. With much thinner volume than before, Daiwa thinks "the new normal" is
that price movements tend to be exaggerated, whether they are rising or falling.
It thinks this has resulted in a significant rise in pricing power of primary market
projects, which will not be sustained once sentiment weakens.
Daiwa's base case is for a 6% correction in 2018 from the August peak and a further 3%
correction in 2019. (KL)