January has just ended, and both primary and secondary market transactions have been rebounding. The strong primary market activity is attributed to mainland buyers entering the market more quickly, increasing their market share to over 50%. Though mainland buyers take part less in the secondary market, the active local buyers took the key role of principle buyers. As a result, the volume of secondary market transactions is steady. Seeing the active market, developers have raised prices for some new projects by 3-5%, while secondary market transactions have seen a surge in investment buyers rushing to sell, leading to home prices rising slightly.
With a slight rebound in the housing market, Morgan Stanley had raised their forecasts for a 10% increase in property prices this 
year. Despite the positive sentiment towards property market recovery, many investors, instead of increasing their inventories, are accelerating the sale of their properties. Various stakeholders should pay attention to what these investors have done.
Recently, renowned investor Ken Sir (Lu Yujian) sold his unit in The Peak Peninsula, which he had held for a year, making a profit of HK$3.13 million. He personally traded six units over the past year, making a profit of HK$7.5 million. If Ken Sir believes property prices will rise by 10% at the end of this year, he has no reason to cash out his gains quickly. Furthermore, the group of “the ladies’ short-term trading club” who was always active in Mei Foo Sun Chuen, spent HK$74 million to buy seven units in recent years, but have recently sold them all, making a profit of HK$6.1 million
The new developments Kai Tak “the Cullinan" and Sai Kung“Sierra Sea”saw 27 and 36 cases successful short-term resale transactions respectively in the past year, with the former average profit of HK$1.63 million per unit. No matter if professional investors or individual investors, they were rushing to cash out, and they resold their newly purchased properties within 12 months. They seemed to believe that the current property market was only a short-term rebound, and they strongly adhere to the principle of " Never leave money on the table.”
The investors are quickly exiting holding positions which might relate to the sustained rise in gold prices and stock markets. Gold prices rose by 70% last year and another 24% in January this year, far beyond expectations. Therefore, it cannot be ruled out that some investors may sell their properties to cash out and then reinvest in spot gold or ETFs. If the rise in gold prices continues, the return on investment in gold or related products could be higher than that of property investment.
If investors don't buy gold but instead of investing in Hong Kong stocks market, the potential return on stocks will be impressive. For example, HSBC's share price rose by 78% last year. Selling properties now to buy stocks would likely yield more returns than investing in property. Since the investment return on gold or stock market is potential higher than that in property investment, this explains why investors are rushing to offload their premises for cash recently.
