Residential Real Estate - Hong Kong

Hong Kong

The Residential Real Estate market market in Hong Kong is projected to reach a value of €2.79tn by 2024.
It is expected to exhibit an annual growth rate of -1.32% (CAGR 2024-2029), leading to a market volume of €2.61tn by 2029.
In comparison to other countries, China is anticipated to generate the highest value in the Real Estate market, with an estimated worth of €103.6tn in 2024.
Hong Kong's residential real estate market is experiencing a surge in demand due to its status as a global financial hub and limited land supply.

Key regions: Europe, Brazil, France, Asia, United States

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Analyst Opinion

The Residential Real Estate market in Hong Kong has been experiencing significant growth and development in recent years.

Customer preferences: One of the main factors driving the growth of the Residential Real Estate market in Hong Kong is the strong demand from both local and international buyers. Hong Kong has a limited supply of land, which has led to a scarcity of residential properties. This scarcity, combined with the city's status as a global financial hub and its attractive tax policies, has made Hong Kong an attractive destination for property investment. Additionally, Hong Kong's strong economy and stable political environment have further fueled the demand for residential properties.

Trends in the market: One of the key trends in the Residential Real Estate market in Hong Kong is the increasing popularity of high-end luxury properties. Wealthy individuals from around the world are investing in luxury properties in Hong Kong as a way to diversify their investment portfolios and take advantage of the city's strong property market. These luxury properties often come with exclusive amenities and breathtaking views of the city, making them highly sought after by affluent buyers. Another trend in the market is the growing demand for smaller, more affordable residential units. As property prices in Hong Kong continue to rise, many buyers are looking for more affordable options. This has led to an increase in the development of smaller residential units, such as micro-apartments and studio apartments. These smaller units offer a more affordable entry point into the property market, particularly for first-time buyers or those looking for investment opportunities.

Local special circumstances: One of the unique factors influencing the Residential Real Estate market in Hong Kong is the city's limited land supply. With a population of over 7 million people, Hong Kong has one of the highest population densities in the world. This scarcity of land has driven up property prices and created a highly competitive market. Developers are constantly looking for innovative ways to maximize the use of limited space, leading to the development of high-rise buildings and compact living spaces.

Underlying macroeconomic factors: Several underlying macroeconomic factors have contributed to the growth of the Residential Real Estate market in Hong Kong. The city's strong economy, supported by its robust financial sector, has attracted both local and international buyers. Additionally, low interest rates and favorable mortgage policies have made it easier for individuals to finance their property purchases. The government's efforts to stimulate the property market through various measures, such as tax incentives and relaxed regulations, have also played a role in driving demand for residential properties. In conclusion, the Residential Real Estate market in Hong Kong is experiencing significant growth and development due to strong customer preferences, including the demand for luxury properties and smaller, more affordable units. The local special circumstances of limited land supply and high population density have further fueled the market. Underlying macroeconomic factors, such as a strong economy and favorable mortgage policies, have also contributed to the growth of the market.

Methodology

Data coverage:

Figures are based on total and average value of residential real estate, residential estate transactions and leases.

Modeling approach:

Market size is determined by a combined top-down and bottom-up approach. We use national statistics, international organizations, and industry associations to analyze the markets. To estimate the market size for each country individually, we use relevant key market indicators and data from country specific industry associations such as GDP, price level index, household wealth, household size, number of renter and owner households, housing consumer spending per capita.

Forecasts:

We use a variety of forecasting techniques, depending on the behavior of the market, for instance, exponential trend smoothing. The main drivers are GDP per capita, population, number of renter and owner households, price level index, housing consumer spending per capita.

Additional Notes:

Data is modeled using current exchange rates. The market is updated twice per year in case market dynamics change. The impacts of the Russia-Ukraine war are considered at a country-specific level.