The stock markets in Hong Kong and China remain in the spotlight, as more money is poured into the region. The property market benefited by way of a spillover from the stock market, as some investors tried to lock up their profit by divesting.

Despite what property developers say in public, the government land auction results are the best interpretation of what they really think. In the last three land auctions. the final sales prices were in the low range of market expectation before the auctions.

The stock market frenzy in mainland China has reached a historical high in the last few weeks. Both Shanghai and Shenzhen stock markets are experiencing an unprecedented boom, as more than 50% of the urban working population is engaged in stock trading. From various press reports, a great majority of these investors are novice and are punting for quick profit. However, the current pricing of stocks has gone way beyond that which fundamentals can support. From past experience. a bust is looming large on the horizon.

The primary sales market has recently stolen the limelight. with robust sales reported on all fronts from Hong Kong Island to the New Territories. and from small flats to large units. The long Easter holiday was a timely breather for the second-hand luxury property market, which had been charging ahead at full throttle for three months following the record land auction last December.

Southside and Midlevels on Hong Kong Island. demand for large units of over 2,000 square feet has long outstripped supply, which over the years has seen no appreciable increase. Gaining particular favour lately are the free-standing single houses, which have seen dwindling supplies over the past three decades largely due to redevelopment into townhouses and the fact that there is no new supply at all.