A Rebound for Hong Kong’s Property Market

Summary

Praveen Choudhary of Morgan Stanley argues Hong Kong real estate is entering its first synchronized growth cycle since 2018, with residential prices, Central District office rents, and retail sales all turning up together. He expects residential prices to rise more than 10% in 2026, driven by stamp-duty removal, mainland buyer demand, population and talent inflows, better affordability, lower mortgage rates, and the Hang Seng wealth effect. He says the market is not just stabilizing but turning, with office and retail also improving.

• Hong Kong property is seeing synchronized growth across major segments for the first time since 2018.
• Residential prices bottomed after a 30% decline and are expected to rise over 10% in 2026 after 5% in 2025.
• Policy support includes the removal of extra stamp duties, which lifted mainland buyer share to about 50%.
• Demand fundamentals are strengthening through population growth, talent visas, household formation, and mainland buying.
• Affordability has returned close to long-term averages as mortgage rates fall and the Hang Seng's 2025 rally supports wealth effects.
• Central District office rents and retail sales are also set to grow, with the office market finding its footing and the retail environment improving.
• The speaker frames the Hong Kong property recovery as out-of-consensus versus concerns about China's residential outlook.