Mainland buyers could substantially push up demand for Hong Kong housing, says CLSA

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A shift towards Hong Kong by mainland Chinese new home buyers could significantly add to pressures on the city’s new housing stock. Photo: Dickson Lee

Published: 9:00am, 18 Sep 2017Updated: 10:09pm, 18 Sep 2017

Hong Kong’s property market could experience a significant demand boost if a small fraction of new home buyers in mainland China cast their attention to the city, according to CLSA.

Demand for Hong Kong homes could surge by 10 per cent if 1 per cent of the transaction value of new homes in tier one cities in China were to redirect towards Hong Kong, said Nicole Wong, managing director of property research at CLSA.

Eva Liu, from Shanghai and now studying at Hong Kong Baptist University, plans to buy a flat in Hong Kong in the future..

“In 2003, my family bought a house in Shanghai at about 1 million yuan. Its value has risen to about 10 million yuan now,” said Liu.

“As our family plans to move to Hong Kong in the future, we will sooner or later sell the house in Shanghai for a smaller one in Hong Kong,” Liu added.

In 2016, the value of new flats sold in tier one cities in China amounted to HK$1.8 trillion (US$230.36 billion), while new homes sold in Hong Kong totalled HK$190 billion, according to statistics compiled by CLSA using data from CEIC Data and Midland Realty.

Of the 613 cities in mainland China, only Beijing, Shanghai, Tianjin, Chongqing and Guangzhou are classified as tier one.