12-12-2018

The U.S. economy is expected to grow at a slower pace amid the negative impacts led by trade war and fading fiscal stimulus. Considering Fed officials’ comment and meeting notes, investors start believing that the Fed will pencil in fewer rate hikes in 2019. Local property investment companies could therefore gain momentum for a rerate and attract market attention again. Also, Hong Kong’s total retail sales in October increased 5.9% year to year, exceeding market expectation of 3.6%, which is also its 20th month of expansion. The growth in retail sales picked up somewhat in October after a deceleration in the preceding month, signaling a positive outlook of Hong Kong retail sales market. Retail sales and occupancy rate of retail properties are anticipated to further increase which will provide extra momentum for local property investment companies’ revenue growth. Furthermore, stock market is likely to remain volatile amid the US-China trade dispute. Therefore, property investors with HK dollar as main income, coupling with stable rental income and dividend payout, are therefore a promising medium-to-long term investment.

Reference:
Bloomberg
HK Census and Statistics Department
HK Economic Journal

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