According to the latest information from DSEC (Direcção dos Serviços de Estatística e Censos), there were 2,342 residential transactions in Q3/2019, which is the second continuous quarter when residential transactions of over 2,000 were recorded, after a steady decline from Q4/2018 to Q1/2019, which only recorded 1,756 and 1,379 transactions per quarter respectively.

In Q3/2019, first time homebuyers continued to dominate the market as they account for over 80% of all buyers at a time when there are fewer buyers anyway, especially buyers willing to lump sum prices. Since Q1/2018 a new measure has provided a higher LTV ratio to the targeted first-time homebuyer group and reduced the LTV for those outside this group, causing more first-time homebuyers to enter the market while the rest are leaving or waiting.

The overall average transaction price of residential properties has fallen by over 8% since Q1/2018, and hasn’t recovered, while residential properties of different sizes have recorded very different trends. Apartments with a smaller GFA below 50 sq m of saleable area, recorded contrarian growth of over 8% from Q1/2018, due to the recently implemented policy in 2018 which provided a higher LTV ratio for residential properties with a lump sum lower than MOP8 million.

This trend reversed for larger apartments with a saleable area greater than 150 sq m, as unit transaction prices fell by over 21% from Q1/2018. Several broader economic uncertainties are affecting the performance of the local real estate market, and there are few positive factors for luxury market sentiment.