Macau home prices edge down, rents flat

[Photo: Yukie Lei]

Macau’s residential property market is seeing slight price adjustments and stable rents, though some industry insiders expect rents to remain flat for the foreseeable future.

An unnamed real estate industry insider told the Chinese-language media outlet Macao Daily News, as published on Thursday, that the forecast is based on a decline in the number of non-resident workers, with some relocating to Hengqin, and on some residents taking advantage of policy opportunities to switch from renting to buying.

Such a combination of factors has reduced demand for residential rentals, the same source said.

Macau’s average residential rent dipped 0.4% quarter-on-quarter to MOP140 per square meter in Q1, but rose 0.9% annually, official data shows. District trends varied, with the Outer Harbour and Nam Van Lake rosing 0.85%, ZAPE up 0.7%, while San Kio fell 1.5%.

On the residential price index front, the overall residential price index stood at 188.9, down 1.5% from the previous quarter. The existing home price index fell 1.7% quarter-on-quarter to 201.2, while the presale home price index bucked the trend, rising 0.6% to 240.3.

By district, the existing home price index declined by 1.55% on the Macau Peninsula and by 2.3% in the Cotai area.

According to industry sources, Macau’s steady economic recovery following the lifting of pandemic restrictions has prompted integrated tourism and leisure enterprises, as well as tourism-related small- and medium-sized businesses, to expand their workforces to accommodate surging visitor arrivals. This has led to a rapid rebound in the non-resident worker population and a corresponding increase in overall housing demand.

Regarding residential housing demand, the prolonged downturn in the property market has made residents hesitant to enter the market. Some residents in need of housing have opted to rent, waiting for property prices to reach a floor before considering purchases. These two dynamics have pushed rental prices higher, despite the broader market trend.

Nevertheless, the real estate agent reportedly noted that authorities have imposed stringent controls on approvals for non-resident workers in recent years. Not only are new applications subject to rigorous scrutiny, but some renewal applications are also being denied. Consequently, the number of non-professional non-local workers is declining, and the overall non-local worker population is shrinking rather than expanding.

Additionally, since the Taipa section of the Light Rapid Transit system and the Hengqin station became operational, some non-local workers employed in Taipa and the surrounding Cotai area have relocated to Hengqin, where comparable rental payments secure access to higher-quality housing. This has led to an overall decline in housing demand among the foreign worker population.

Mainland students will push rents to new highs in Q3, but the rise will be limited, the industry insider said. Strict non-local worker vetting and talent policies will keep rents flat for a while.