REAL ESTATE | Interview with Juliet Risdon | ‘There’s a whole correction in the market’

Juliet Risdon

With extensive experience in Macau’s real estate industry, Juliet Risdon, director and designer at JML Property, stresses that there’s a whole correction occurring in the market, and one that is needed. As gaming revenue dropped for a sixth consecutive month in November, and with the Hengqin border soon to be operating around the clock, analysts have suggested that Macau’s real estate market will cool off.
In an interview with The Times, Ms Risdon, whose company was one of the winners of the “GoHome Awards 2014,” reiterated that the next 10 years look very positive as the next wave of Cotai resorts take shape and regional development continues. She forecasts that rents will continue to rise, leading locals to most likely eye Hengqin or Zhuhai as another suitable choice of home.

Macau Daily Times – The Hengqin border will soon be operating around the clock and analysts say this could cool off Macau’s real estate market. Would you agree?
Juliet Risdon (JR) – I think it’s a good thing. Macau is very expensive and I think Hengqin will offer opportunities [for those] on lower incomes to have a nice property to live in. So I don’t think it’s a bad thing. Macau needs space and I think, as far as the population is concerned, it’s unhealthy for so many people to live in such a small area.

MDT – Home prices will continue to drop in Macau?
JR – Prices are going down at the moment anyway; there’s a whole correction going on in the market, which is needed. The market was very high, with a lot of transactions happening earlier this year. It’s a time of correction anyway, and that just may coincide with the border opening 24 hours. We have a long-term view on Macau. Now Macau is correcting itself, it’s a good thing. And I think the next five to ten years are still very positive for Macau. So maybe prices will go down a little bit but they will come back up again.

MDT – There are always two sides to this story: real estate agents wishing to increase profit and locals trying to cope with expensive housing. Will the market continue to be worth it for real estate agents?
JR – It doesn’t matter in which business you’re in, you have to be smart in the way you handle the business and the good real estate agents will see any market through, a good market, a bad market, an up market, a down market. You’ll see the poor agents disappearing at this time and you’ll see the good agents continue because there’s always some work to be done. People argue that home prices are expensive because of real estate agents but it’s really about supply and demand. A real estate agent doesn’t stipulate the price of the property, that’s down to the buyer and the seller. It’s a very expensive place, particularly for very low salary earners, it’s incredibly difficult. So I think Hengqin is an incredibly good opportunity to have a bigger property in a nice environment, and not that far from Macau.

MDT – It has been reported that real estate agencies in Zhuhai have been promoting and selling apartments to Macau residents that are not yet finished, which goes against mainland China’s laws. Is this also affecting Macau’s market?
JR – We are a real estate company, but what affects the majority of real estate agents doesn’t affect us in the same way. What we offer to our clients is not only the sale of a property, but we offer a whole program of client services. Because in Macau a lot of people don’t want to rent out their houses because they’re afraid the tenant is going to damage the property or the tenant is afraid they’re not going to get back the security deposit… what we do as a company is to act as a medium, we will tell them that we will take care of collecting the money, we will do inspections of your property and the tenant can deal with us directly. Clients that have that service have never left us unless they’ve sold the property. It hasn’t affected us. As a company we do not do any cross-border transactions, we do not promote or sell properties in China individually. It’s riskier to invest in China.

MDT – Do you believe we’ll see an increase in the number of people buying homes there?
JR – Many people have and many people are talking about it and they will. I don’t think it’s a bad thing for local people. I think it can work very well for older people, because the quality of life in Hengqin is much nicer, much greener, bigger spaces, and not too busy.

MDT – What’s your outlook for the Macau market right now?
JR – The market is correcting itself. We can see prices are now being corrected, transactions are happening with motivated sellers and buyers as opposed to investors or speculators. Macau has a long way to go, there’s so much happening here with so much development. You have the Hong Kong-Zhuhai-Macau bridge, development in Hengqin and Zhuhai, huge casinos. So I think the next ten years will still be very positive for Macau. I think rents will probably continue to rise, which makes it really expensive from a tenant’s point of view. But that’s definitely down to supply and demand.

MDT – You mention supply and demand, but we see a lot of empty buildings. What do you think could be done to put them onto the market?
JR – It has to be a government-based solution. In Macau there isn’t a main registrar where you can locate the owner of the property. If you could locate the owner I am sure there would be many more transactions happening with the empty properties. I think it’s something that has evolved into something much bigger than what anybody could have anticipated, with the amount of empty properties we now have.
You also have a percentage of properties, for which the ownership is not clear. It all has to be dealt within the government level. It’s a shame for the people of Macau that properties are not kept in a good condition sometimes.

MDT – What’s your opinion on the development of Coloane?
JR – I have lived 21 of my 22 years in Macau in Coloane. So definitely there’s a piece of Coloane in my heart. And I am pleased that they haven’t developed the village, although buildings are creeping over the mountain. I believe that Coloane could have been developed in a more beautiful way. It’s very disappointing for the people of Macau, what has been produced with the public housing; the size, the location, the outlook, the environment. Putting it at the end of Cotai was maybe not the right move, because of the buildings that they built. The whole environment could have been different. The buildings are all boxes. They could have built it with different sizes, put up roof gardens, there are many things that could have been done.

MDT – JML recently received an award in Hong Kong. What does it mean for you?
JR – The award was given in Hong Kong, the GoHome Awards. We were recognized as the Best District Property Agency in Macau. Any recognition is fabulous. As a company we are very fortunate to have a fabulous team. Every employee has played a part in this award. And to be recognized as a team is fantastic, we are a company that provides services to clients, whether they are owners or sellers, or tenants. We like to pride ourselves in taking care of those people and clients.