Central Plains Real Estate: Hong Kong property prices are expected to rise 15% next year, rents are expected to rise by about 5% this year

The Zhitong Finance App learned that Chen Yongjie, Vice Chairman of the Asia Pacific Region of Central Plains Real Estate and CEO of the Housing Department, said that the Hong Kong property market is picking up this year, and the Central Plains City Leading Index (CCL), which reflects the trend of the second-hand residential property market in major housing estates, is expected to rise by about 5% next year. This year, rents are expected to rise by about 5% for 4 consecutive years.

Chen Yongjie pointed out that due to the depreciation of the US dollar, increasing the market's incentives to buy real assets, the relevant trend is expected to continue next year. Coupled with interest rate cuts driving the “rent balance” situation, and the “wealth effect” caused by the rebound in Hong Kong stocks, all of which are beneficial to the Hong Kong property market. It is believed that more investors will enter the market next year. In addition, it is estimated that the middle class will start entering the market one after another next year, which will also drive an upward trend in the Hong Kong property market.

Chen Yongjie pointed out that developers' intention to invest in land has been low in the past two years, causing the Hong Kong government to prudently push for land. At the same time, it is estimated that first-hand housing inventories are expected to fall back to about 18,000 units in the first quarter of next year, hitting a new low of more than two and a half years. He believes developers will no longer need to cut prices.

Chen Yongjie pointed out that as of November of this year, the bank's statistics showed that Mandarin pinyin buyers purchased about 12,500 first-hand and second-hand private homes, the highest number since the bank's statistics were recorded in 1995. It is expected to reach about 13,800 cases for the whole year, involving an amount of about HK$138 billion. On an annual basis, they all hit new highs since the bank had relevant records. Next year, the relevant numbers could rise by about 1%.

Yang Mingyi, senior co-director of the Central Plains Real Estate Research Department, estimates that the total number of property transactions registered in Hong Kong this year was about 78,000, a four-year high, up about 15% year on year. Among them, one-lot transactions accounted for about 20,000, the most in 6 years, an increase of about 19% over the previous year, while second-hand materials accounted for about 39,000 cases, a three-year high, an increase of about 15% over the previous year. She also pointed out that CCL's target for the first quarter of next year will rise 3% to about 147. Assuming that property prices rise 85% in the next 6 years, CCL will hit 250 at that time.