Exodus of Hongkongers triggered by national security law unlikely to dent city’s home prices, say analysts
- The city’s famously lofty home prices, which were subdued by the pandemic, are once again on the rise and approaching previous highs
- They are unlikely to be tamed by a wave of people leaving in the wake of the controversial security law seen as limiting their freedoms
“While a higher level of migration may be unfavourable to residential prices, the negative effect is likely to be minimal as it is insufficient to turn around the severe supply-demand imbalance,” said Nelson Wong, head of research at JLL in Greater China. “In fact, on the contrary, this current wave of migration may have the net effect of triggering a higher transaction volume, supporting mass residential prices.”
For instance, in the third quarter of 2020, withdrawals from the city’s retirement savings scheme reached 8,100 cases, compared to a quarterly average of 7,600 cases in 2019, according to data from Mandatory Provident Fund Schemes Authority.
“Historical precedence shows that a higher level of migration out of Hong Kong, with the assumption that many of them sell their properties, was not necessarily going to drive prices down,” Wong said.
Between 1985 and 1997, about 576,000 residents emigrated from Hong Kong, according to BBC Chinese citing Security Bureau data.