ECONOMIC OUTLOOK – RECOVERY IN PROGRESS

The tourism industry has played a significant role in the economic recovery of Macau. The city’s gaming revenue saw an astounding YoY growth of over 300%, reaching 49.3 billion in the first four months of 2023. Moreover, statistical data as of April 2023 indicates that the rebound in gaming revenue has exceeded the quarterly target and is expected to continue its upward trend.

In addition to the impressive gaming revenue figures, there has been a YoY growth of over 150% in the number of inbound visitors to Macau in Q1/2023, with 4.9 million visitors arriving in the city. The rebound in the hospitality industry has contributed to a decrease in the unemployment rate, which fell from a peak of 5.5% in 2022 to 3.9% in Q1/2023. Overall, these core indicators suggest that Macau is experiencing a positive and ongoing recovery from the adverse impacts of the COVID-19 pandemic.

RESIDENTIAL MARKET STILL SLOW

The residential property market is slowly recovering from its lowest point. According to recent reports, there were 969 property transactions in Q1/2023, representing a YoY growth of 15%, reaching 75% of the pre-pandemic level of 2019. The average transaction unit price in Q1/2023 stood at MOP8,640 per sq ft (saleable area), which is similar to the YoY level but a drop of about 11% compared to 2019. In Q1/2019, there were 211 first-hand residential property sales, but in Q1/2023, the number plummeted to only 4 first-hand sales.

It is believed that the low transaction volume of first-hand properties is due to the decision of developers to avoid selling their properties amidst a mass of uncertainties, including rising interest rates and a relatively weak economy. However, it is worth noting that several developers are now offering aggressive sales plans to activate their sales projects, and it is expected that more first-hand properties will be released to the market in the coming months. This could potentially lead to an increase in transaction volumes and a stabilisation of prices in the residential property market.