OCBC Wing Hang sees home prices growth of 5% by year end

    OCBC Wing Hang Bank said HK's Policy Address mainly focuses on housing, land supply, improving people's livelihood and economic development.
  In the near term, the bank believes the latest housing correction will be capped by the prospects of lower borrowing costs and the loosening mortgage rules on first-home buyers.
  OCBC expects the transaction volume for private flats valued at HK$5-10 million (which took up 58% of total transaction volume) to rebound.
  Owing to the new measures, the property developers which have brought forward their new project launches with sweeteners in the run-up to the implementation of vacancy tax may refrain from cutting offering price going forward.
  As such, in the coming months, despite multiple headwinds weighing on the housing market, housing prices (+8.5% year-to-date as of August) may still be able to show a growth of up to 5% by end of this year.
  Meanwhile, housing and infrastructure construction projects will translate into an increase in public investment in the medium term and therefore help to weather some external headwinds to HK's economy.
  However, by rolling out a raft of relief measures, the bank said HK may see the first fiscal deficit since 2003-04. However, it may not have much impact on the still sizeable fiscal reserve (HK$1.17 trillion for 2018-19 which represented over 40% of GDP).