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UBS flags risks to Hong Kong housing recovery as prices and rents peak

UBS said Hong Kong secondary home prices had fallen up to 28.4% from their September 2021 peak, even as official prices have rebounded 13.4% and rents hit new highs for eight straight months through June.

Reported · Written up by our desk · Residential

Hong Kong’s property market recovery is expected to cool in the coming months for both prices and rents, with UBS pointing to disruption from artificial intelligence, slower population inflows, and other pressures that could weigh on the upturn.

UBS also cited deeper integration with the Greater Bay Area and new home supply coming to the Northern Metropolis as additional factors that may further affect the residential outlook. Mark Leung, a UBS Greater China property research analyst, said the market has not yet fully priced four key risks to Hong Kong’s property market.

The bank noted that secondary home prices fell as much as 28.4% from their peak in September 2021 to a trough in March last year, while government data showed the official home price index has since recovered 13.4%.

Rents have continued to rise, with the Rating and Valuation Department reporting new highs for eight consecutive months as of June.

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