Foreign investors most pessimistic on Hong Kong property market in survey across Asia-Pacific markets

About one-fifth of investors planned to reduce their holdings in the city, compared with only 1 to 8 per cent in other Asia-Pacific cities: JLL survey

Hong Kong’s economy is on course for first back-to-back annual decline since records began in 1961, according to official forecasts

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Global investors plan to reduce their holdings of Hong Kong property assets. Photo: Roy Issa

Published: 9:00am, 3 Sep 2020Updated: 10:03am, 3 Sep 2020

Global investors are most pessimistic on the property market outlook in Hong Kong among major Asia-Pacific locations as the city struggles to emerge from its deepest recession on record and long-running political crises.

About one-fifth of investors said they planned to reduce some of their holdings in the city, according to a survey conducted by real estate consultancy JLL. Only 4 per cent of them wanted to raise their capital allocation, while the rest would maintain the status quo.

Hong Kong had the highest number of investors with selling tendencies. In comparison, only 1 to 8 per cent of investors were looking to reduce their investment in other markets, the survey showed. The proportion of foreign investors seeking to invest more in these other markets ranged from 15 to 56 per cent.

“A relatively weak income and capital value returns outlook over the next 12 to 24 months, coupled with a subdued domestic economy, are weighing on investor sentiment in Hong Kong,” said Nelson Wong, head of research for Greater China at JLL. The longer-term views for many of them, however, have stayed largely unchanged, he added.

JLL surveyed 38 global and regional managers overseeing US$1.8 trillion of assets in the second quarter, it said. It is not clear if the controversial national security law, which was first mooted in May and became effective on June 30, had an impact on the survey results.