The View | Hong Kong’s housing market recovery rests on solid foundations

Hong Kong has its mojo back. The city’s economy grew 3.5 per cent last year, the fastest pace since 2021, according to an advanced estimate published by the Census and Statistics Department on January 30. A sharp increase in exports, the unexpected driver of growth in many Asian economies last year, was a key factor in Hong Kong’s resurgence.

The rebound was underpinned by the dramatic revival in the city’s capital markets. Share sales nearly quadrupled last year to more than US$73 billion through initial public offerings, placements and block trades. This made Hong Kong the top fundraising spot in Asia for the first time since 2013, coming in just behind the United States in the global ranking, according to Bloomberg data.

The Hang Seng Index gained more than 30 per cent last year, with mainland Chinese households and institutions accounting for a quarter of daily turnover on the Hong Kong stock exchange.

HSBC said that “Hong Kong is undergoing a significant transformation in its economic identity. Once recognised as the primary gateway for foreign capital flowing into mainland China, the city is now repositioning itself as a crucial conduit for mainland Chinese capital and enterprises venturing into the world outside.”

This is one of the reasons confidence in the recovery of the city’s property market, especially the residential sector, has increased significantly since the middle of last year. Presenting its forecast for the industry on December 10, JLL said that “after a six-year correction that began in late 2019, Hong Kong’s property market has turned the corner, with office leasing and housing markets leading the recovery”.