CICC: “The off-season is not weak” Hong Kong housing prices rebounded at an accelerated pace in January

The Zhitong Finance App learned that CICC released a research report saying that the number of second-hand private housing units sold in Hong Kong in January leveled off month-on-month, and the transaction amount increased by more than 50% over the same period last year. In terms of price, the leading index for large housing estates in Central Plains cities was +2.5% month-on-month at the end of January, the biggest increase in a single month since full customs clearance in February 2023. The year-on-year increase widened to +7.3% (+5.1% in 2025). Furthermore, the broker index rose month-on-month to 69.04 at the end of January (64.05 at the end of December), indicating that the market or sentiment is on an upward channel, and there is upward momentum in prices.

CICC's main views are as follows:

The turnover of first-hand private homes more than doubled year-on-year, and developers such as Henderson performed brilliantly. The number of first-hand private homes sold in January was flat and slightly lower, significantly stronger than the trend at the end of history (2021-2025 average -33% month-on-month), corresponding a sharp increase of 148% year-on-year to HK$19.2 billion. The total sales of the six key Hong Kong-funded developers were monitored to increase +173% year over year, with Henderson, New World and Changshi all more than tripling; at the project level, Park King Fung (Credit Trust Consortium), Kai Tak Bay Phase 1 (Overseas Chinese Consortium), and Sierra Sea Phase 2A (Sun Hung Kai) ranked in the top three. On the land market side, a residential land sale in Jordan Valley, Kowloon was acquired by the Credit Trust Consortium.

The volume and price of second-hand private homes both increased, and housing prices recorded the biggest increase in a single month in three years. The number of second-hand private homes sold in January leveled off month-on-month, and the transaction amount increased by more than 50% over the same period last year. In terms of price, the leading index for large housing estates in Central Plains cities was +2.5% month-on-month at the end of January, the biggest increase in a single month since full customs clearance in February 2023. The year-on-year increase widened to +7.3% (+5.1% in 2025). Furthermore, the broker index rose month-on-month to 69.04 at the end of January (64.05 at the end of December), indicating that the market or sentiment is on an upward channel, and there is upward momentum in prices.

The real estate finance environment continues to be moderately supportive, and interest rates are falling steadily. Mortgage loans approved in December and 2025 both increased 22% year over year, and the annual average mortgage ratio increased by 2.1ppt to 60.1% compared to 2024. Interest rates on newly approved mortgages fell 6BP to 3.25% month-on-month in December, adding 17BP (November+13BP) over the same period. The returns for Class A and Class B private homes were 3.6% and 3.1% during the same period.

The commercial real estate vacancy rate declined month-on-month, and Social Zero continued to pick up. There was a certain month-on-month improvement in the vacancy rate for private office buildings and retail properties in December, down 0.3 ppt and 1.2 ppt from November, respectively. In terms of rent, the rent index for office buildings and retail properties fell 0.2% month-on-month in December, respectively. Among them, the rent index in Sheung Wan/Central achieved positive year-on-year growth, and the improvement in vacancy rates was also ahead of other regions. Retail sales in December continued the recovery trend since September (the growth rate changed in May, with year-on-year increases of more than 6% in September-December), which continued to be driven by gradual financial and economic recovery and an increase in the number of visitors to Hong Kong.

risk

The overseas interest rate cut process fell short of expectations, and the scale and pace of the incremental supply of commercial real estate exceeded expectations.