The window displays at the Hong Kong property agency where Stephen Poon works are bursting with cut prices, last minute reductions and cash incentives.
But buyers were still few and far between, as the stumbling global economy has cut dead the city’s five-year booming property market.
“It has been very quiet,” said Poon, a property agent for Midland Realty, a large city firm.
“Before September our branch was making 2 [million] to 3 million Hong Kong dollars [US$256,000 to US$385,000] every month, but now it’s only around 50,000,” he said, describing a 98 percent drop in revenue.
The global financial crisis is rapidly stunting Hong Kong’s office, luxury and residential property markets after they hit a peak in the early summer.
Signs outside agents have shown discounts of more than HK$1 million in recent weeks and analysts said they expected prices in every sector to drop by an average of 20 percent to 30 percent before next July.
With sellers reluctant to lose value and many potential buyers holding off amid stock market turmoil and tightening lending conditions, many agents in the territory have already lost their jobs.
Nearly 5,000 agents in Hong Kong and China have left the city’s biggest property group Centaline since June as the company struggles with plummeting commissions, Centaline’s chairman Shih Wing-ching said.
“[Before the slowdown] 10,000 to 12,000 units were being sold in Hong Kong each month, but October saw half that amount,” he said.
Anyone buying in the hope that values will appreciate over the next year is “juggling with knives and razorblades,” said Chris Dillon, author of a recently published guide for buyers in the territory.
“Nobody can call bottom in this downturn yet,” he said. “Anyone who says they can is bluffing.”
The malaise has hit the luxury sector particularly hard. Plunging values saw a house near Victoria Peak, one of Hong Kong’s most prestigious addresses, selling for less than half its asking price of HK$190 million in recent weeks, local media reported.
“The [overall] market has seen dramatic change in the past month alone,” said Simon Lo, director of research at Colliers International, adding that 5 percent was wiped off the entire market in September.
“This kind of cycle could last for two more years,” he said.