Hong Kong home prices rise for the first time since March, though rents cool slightly

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Secondary home prices increased 0.62 per cent in October

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A real estate agency in North Point. Photo: Eugene Lee

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Published: 11:05am, 27 Nov 2024Updated: 1:22pm, 27 Nov 2024

Hong Kong’s lived-in home prices rose in October, according to official data, arresting a five-month decline following an interest-rate cut and eased mortgage rules unveiled by Chief Executive John Lee Ka-chiu.

Analysts believe the most challenging phase for Hong Kong’s housing market has passed and residential prices are expected to stabilise in the near term. However, any meaningful improvement in prices is unlikely to occur until next year, specifically in the second half.

Secondary home prices increased 0.62 per cent to a reading of 290.1 in October from 288.3 in September, according to data from the Rating and Valuation Department.

The latest reading on home prices covers the first full month following the interest-rate cut by the Hong Kong Monetary Authority in September, but only partially reflects the eased of mortgage financing requirements, which included raising the loan borrowing limit and increasing the debt servicing ratio to 50 per cent from 40 per cent for all properties.

Still, home prices are down by about 7 per cent so far this year. From their all-time high in September 2021, home prices have declined by more than a quarter.

Meanwhile, home rents retreated by 0.3 per cent, their first decline since February.

Rents have been on an general upward trend since May last year and were just four points shy of the 200.1 peak recorded in September 2019. So far this year, home rents have risen by about 4.8 per cent.