Hong Kong July home prices grow faster, up 0.4% on month
[HONG KONG] Hong Kong’s monthly home prices rose 0.4 per cent in July for a fourth successive month in accelerated growth, government data showed on Wednesday (Aug 27), supported by warming sentiment on lower mortgage rates and better stock market performance.
Private home prices edged up 0.4 per cent in July over June, following a climb of 0.03 per cent each in May and June, data from the Rating and Valuation Department showed. July’s rise was the fourth month in a row.
Prices had dropped 0.4 per cent this year.
Home prices in Hong Kong, one of the world’s least affordable cities, have tumbled nearly 30 per cent from a 2021 peak, hurt by higher mortgage rates, a weak economic outlook, and poor demand as many professionals have left the territory.
Authorities tried to prop up the sector last year, removing curbs on property purchases and relaxing ratios on down payments, but housing demand has kept soft.
The one-month Hong Kong dollar interbank rate Hibor, to which many mortgage plans are linked, rebounded to 2.8 per cent in mid-August after having dropped below 1.2 per cent since May, from more than 3.5 per cent in the past two years, which had made mortgages more affordable.
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Property developers have been selling new flats at discount to boost sales, suppressing the secondhand market, which the official price index reflects.
Realtors forecast home prices in 2025 could rise or fall by 5 per cent, depending on the pace of official rate cuts and the severity of trade tension between China and the US.
Brokerages including Morgan Stanley and HSBC recently said they expected the Hong Kong residential market to bottom out.
“Signs of a bottom-out in residential prices are becoming more evident,” said Eddie Kwok, the executive director of property consultancy CBRE Hong Kong. REUTERS
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