Editorial | Cash-for-residency scheme must not worsen housing market for locals

Talent scheme an example of how government must balance deepening of talent pool with prioritising needs of Hongkongers

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Hong Kong as seen from Victoria Peak. Market analysts predicted a boost in demand for luxury homes following Hong Kong’s easing of the property investment requirements in its cash-for-residency scheme. Photo: EPA

Published: 6:45am, 27 Sep 2025

Enhancement of a cash-for-residency scheme might not have stood out in Hong Kong leader John Lee Ka-chiu’s comprehensive policy address last week. But the measure is worthy of support and continued attention to ensure it benefits the city and the high-net-worth investors it draws. The chief executive used his fourth policy blueprint to unveil plans to enhance the New Capital Investment Entrant Scheme (New CIES). Introduced in last year’s policy speech, the scheme requires applicants to prove they have at least HK$30 million (US$3.8 million) in assets or equity in the city.

Under the new rules, the maximum residential property investment amount is HK$10 million, but the transaction price threshold is lowered from HK$50 million to HK$30 million. The maximum amount of non-residential property investment was also raised from HK$10 million to HK$15 million.

The government said the goal was to enrich investment options beyond equities and funds rather than stimulate the property market. Market analysts predicted a boost in demand for luxury homes. High-net-worth individuals attracted by the scheme include many from mainland China, and there are those among them who see Hong Kong as a potential springboard to go elsewhere. A major obstacle is their ability to move money into the city.

Some lawmakers have suggested setting up a closed-loop capital pool that would allow migrants who entered through talent schemes to transfer money from the mainland to buy properties. Critics have voiced reservations, citing its potential impact on residents.

It is encouraging that residential property transactions valued at more than HK$30 million accounted for about 22 per cent of the total transaction value, but less than 3 per cent of transaction volume – a sign the scheme will not significantly affect competition for properties or affordability for most households.

Concerns must be thoroughly addressed, however. There are many focus areas cited in Lee’s road map that can deepen the talent pool as well as prioritise the needs of Hongkongers. The cash-for-residency scheme is one example of many where finding a balance will be essential to ensure the city can reach its goals.

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