Cushman says Hong Kong home rents and leasing activity expected to rise in second half, even as analysts paint divergent picture for home prices

The leasing market has reported growth since the reopening of the border, Cushman executive says

Positive outlook for rents and leasing comes amid divergent forecasts for Hong Kong’s property market in the second half of 2023

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High interest rates, recent stock market volatility and geopolitical tensions are expected to dampen a recovery in residential prices. Photo: Sam Tsang

Published: 8:30am, 7 Jul 2023

Hong Kong home rents are expected to continue rising in the second half of 2023 even as the volatility in home prices persists, Cushman and Wakefield said.

The city’s housing market initially witnessed a recovery in prices after the border with mainland China was reopened in February, according to a report released by Cushman on Thursday. The prices of lived-in homes have recorded a cumulative increase of 4.9 per cent over the last five months, even after the price index recorded its first decline in May and fell by 0.7 per cent, the report said.

But persistent high interest rates, recent stock market volatility and geopolitical tensions are all weighing on sentiment and are expected to dampen a recovery in residential prices, said Rosanna Tang, executive director and head of research at Cushman.

The leasing market, on the other hand, has reported growth since the reopening of the border, and has also benefited from a pledge made by the Hong Kong government to attract more talent to the city with its Top Talent Pass Scheme, Tang said.

“This is a good sign for the leasing market,” she added. “And it has already been partially reflected in the rental index, which has risen by 4 per cent over the last four months.”

The rental index will put in a more stable performance compared to the price index this year, and it will also slightly outperform home prices by one to two percentage points, Tang said.

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