CRIC: Hong Kong Property Prices Expected to Rise by 15% Next Year, with Rental Prices Expected to Rise by approximately 5% This Year.

Chen Wing-kee, Vice President and President of the Residential Department of Asia Pacific Region of Centaline Property, stated that the property market in Hong Kong has shown signs of recovery this year. It is expected that the Centaline City Leading Index (CCL), which reflects the trends in the secondary residential market of major large-scale housing estates, will increase by about 5% for the whole year and by 15% next year. This year, rental prices are expected to increase by about 5%, marking the fourth consecutive year of increase. Chen Wing-kee pointed out that due to the depreciation of the US dollar, there is an increased incentive for the market to invest in physical assets. This trend is expected to continue next year. Additionally, the rate cut will stimulate the situation of "rent exceeding supply", and the rebound of the Hong Kong stock market will create a "wealth effect", all of which will benefit the property market in Hong Kong. It is believed that more investors will enter the market next year, and the entry of middle-class buyers will also drive the upward trend of the Hong Kong property market. Chen Wing-kee mentioned that in the past two years, developers have shown low interest in land acquisition, prompting the Hong Kong government to cautiously release land. There will be a supply gap in the first two quarters of next year, while the inventory of first-hand residential properties in the first quarter of next year is expected to fall to about 18,000 units, hitting a new low of over two and a half years. It is believed that developers do not need to further reduce prices to promote sales. As of November this year, the number of transactions by mainland Chinese buyers for first-hand and second-hand private residential properties recorded by the bank was about 12,500, the highest since the bank began tracking in 1995. It is expected to reach about 13,800 transactions for the whole year, involving approximately HK$138 billion, setting a new record since the bank began tracking. The number of transactions is expected to increase by about 1% next year. Yang Ming-yee, Senior Joint Director of the Research Department of Centaline Property, estimated that there were about 78,000 real estate transactions in Hong Kong as a whole this year, reaching a new high in about four years, with a year-on-year increase of about 15%. Of these, around 20,000 transactions were first-hand, the highest in six years with a year-on-year increase of about 19%, while about 39,000 transactions were second-hand, reaching a new high in three years with a year-on-year increase of about 15%. She also mentioned that the target for CCL in the first quarter of next year is to increase by 3% to about 147. Assuming a future price increase of 85% over the next six years, CCL will reach 250 by then.