The investment market has been changing significantly since Trump took office in United States this year. Profiting in the U.S. and Hong Kong stock markets is challenging due to their ongoing fluctuations, regardless of your stance. Due to the ongoing tariffs war, first-hand properties must be opened for sales at lower prices. Second-hand properties prices have experienced even steeper reductions. Additionally, landlords of retail and office spaces are facing declining rents and increasing vacancy rates.
Durning this market downturn, seasoned investors are under greater pressure than the general middle class. 
These investors typically own shops and commercial spaces for rental income. Rent collection is a straightforward process, but experienced investors have frequently utilized property appreciation for refinancing purposes over the past three decades. Though property prices experienced a sharp drop during the financial crisis from 1997 to 2003, and the financial tsunami in 2008, but it quickly rebounded after these two crises. As a result, most investors believed a larger and uncontrollable market crash was unlikely to come.
Experienced investors recognized that the property market had reached its peak and began to decline three years ago. However, they were reluctant to lower prices in order to sell mortgaged shops and offices for de-leveraging purposes. Some investors even bought shops at lower prices, and they believed that the rental income of shops within housing estates should be stable. However, rents fell due to the expenditure pattern shifting to neighboring China cites, and shop prices dropped as rents fell.
If there were no tariffs war, the impact of this market crash does not cross tolerable level. But the tariffs war started in April, and the investment market collapsed. China' s domestic exports to the US fell sharply and factories reduced production, and it quickly damaged the investment sentiment. Banks increased pressure to call loans, forcing investors to sell properties at ultra-low prices. A lot of second-hand properties landlords also sold their assets, leading property price to plummet and resulting in 40,000 units into negative net worth.
JLL also indicated that the number of these negative equites is expected to increase to 80,000 by the end of this year. Given the current market conditions, the likelihood of this pessimistic scenario occurring is approximately fifty percent. Furthermore, the ongoing Sino-US tariffs war may extend for one quarter more, adding challenges to the already fragile property market.
