Here's how Hong Kong's property sector reacted to new cooling measures

Home sales down 26% within 3 months after BSD implementation.

According to Colliers, the average transaction volume was the most obvious indicator of the market’s reaction to previous government measures to cool short-term trading activities and buying demand from non-local purchasers.

For example, the average volume of residential sales transactions fell by 38% during the 22 months from the date when the SSD was first implemented in November 2010 and its revision in October 2012. 

The volume dipped further by 26% within three months of the introduction of BSD and the extension of SSD in October 2012.  

In effect, prospective buyers factored these additional charges into their total acquisition costs with the expectation that further capital appreciation would remain intact.

This is demonstrated by the fact that prices started to edge up again, despite mild corrections just after each new measure was announced.

We therefore believe the same is going to happen again after the latest measures, even though the level of stamp duty has doubled with the latest cooling measures in February 2013.