Hong Kong: The frenetic buying of homes, offices and car parks has lifted the total spend on property to HK$300.2 billion (US$38.2 billion) in less than five months this year, the highest level in the past 21 years, according to Hong Kong brokerage Midland Realty.

The record for the first five months – HK$402.1 billion – was set in 1997, but analysts expect total property transaction values to set a new record in 2018, as prices rise sky high.

The prices of used homes in Hong Kong have now risen for 24 consecutive months, to a record high, with most new projects selling out in the first few hours on launch day.

“The surge in total transaction value was mainly led by a sharp rise in the sales of used homes at higher prices,” said Anita Cheung, senior manager at Midland Realty’s property data and research centre.

On Wednesday, Midland Realty said sales of residential properties, including used and new homes, amounted to HK$237 billion, or 79 per cent of the total, while the sales of non-residential properties amounted to HK$60.4 billion.

The total transaction value of used homes had risen by 20.5 per cent to HK$159.2 billion as of May 21, said Cheung.

The average price for used homes stood at HK$7.7 million during the period, up 11 per cent from HK$6.94 million for the whole of 2017, she said.

Taikoo Shing in Quarry Bay was the most active housing estate, with 148 homes changing hands for a total of HK$1.87 billion during the period.

New homes cost HK$14.5 million on average, 12 per cent higher than HK$12.97 million in 2017.

“Home prices have climbed to a very high level. As interest rates are widely expect to enter an uptrend cycle in the second half this year, the property sector is likely to be exposed to higher risk,” said Alfred Lau, a property analyst at Bocom International.

Homebuyers also went ahead with their purchases despite the tightening of mortgage lending in the secondary residential market.

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“Homebuyers have been more proactive and willing to chase after higher prices in the past month. It may relate to the volatile trading in the stock market, which might have pushed more investors to shift their capital to property,” said Lau.

Year-on-year total spending in the primary residential sector, however, fell by 27.6 per cent to HK$77.8 billion as of May 21, said Cheung.

“The fall was because fewer new projects were launched. Developers will catch up with their sales revenue by speeding up sales in the second half this year,” she said.

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Cheung said she expected between 18,000 and 20,000 new flats to be ready for presale this year.

She also added that the total transaction value so far did not take into account the HK$40.2 billion sale of The Center, as the deal had not yet been registered with the Land Registry.