Hong Kong buyers nudge Greater Bay Area home prices to new heights after easier ownership rules

Dongguan recorded the biggest gain of 22 per cent in 2019, or four times the average gain in the Greater Bay Area

Prices in Shenzhen, Huizhou and Foshan reached new highs, surpassing the average gain in Hong Kong

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A screen shows a map of Greater Bay Area during a symposium in Hong Kong on February 21, 2019. The region is set to transform the traditional manufacturing hub into an economic powerhouse on its own to rival the Silicon Valley in the US. Photo: AP

Published: 12:00pm, 28 Jan 2020Updated: 10:57pm, 28 Jan 2020

China may have fueled a housing boom in the Greater Bay Area with easier ownership rules, as buyers from Hong Kong joined the rush to send home prices in some cities to record highs, according to data from Centaline Property.

An index tracking prices of new and used homes in Shenzhen rose for a fifth straight month in December to cap a 9.4 per cent rally in 2019, according to Centaline Property. Prices climbed 10.5 per cent in Foshan and 7.4 per cent in Huizhou.

The indicators for the three cities are at their highest levels since March 2016 when Centaline started gathering home prices in cities across the southern Guangdong province. On average, prices in the GBA region climbed 5.6 per cent in 2019, while Hong Kong saw a 4.4 per cent gain, Centaline said.

Hong Kong’s government unveiled in November a proposal by Beijing to ease home ownership and employment rules for its residents in the GBA region. Before then, some mainland cities imposed ownership buying curbs on Hong Kong residents, including requiring a certain period of residency and taxpaying status.

“The news encouraged more Hong Kong investors to seek homes in the region,” said Elaine Cheung, general manager of Centaline’s office in Shenzhen. Shenzhen, in particular, saw a 5 per cent jump in the number of transactions in December following the policy relaxation, she added.

The showroom at Yue Infinity project by Yuexiu Property in Panyu district, Guangzhou. Buyers snap up almost all of the 120 units on sale on December 30, 2019. Photo: Sandy Li

The Greater Bay Area represents China’s economic blueprint to link Hong Kong and Macau with nine Chinese cities in the Pearl River Delta and turn them into a new financial and business hub to rival San Francisco and Tokyo. The region as a cluster made up about one-eighth of China’s economy in 2017, with a population larger than the UK and twice that of Canada.