Market Insights Financial Real Estate Residential Real Estate

Residential Real Estate Transactions - Hong Kong

Hong Kong

In Hong Kong, the market segment of Residential Real Estate Transactions market is anticipated to witness a significant increase in transaction value.
By the year 2024, it is projected to reach a value of €22.39bn.
Looking ahead, the market is expected to exhibit a compound annual growth rate (CAGR) of 5.54% from 2024 to 2029.
This growth is forecasted to lead to a market volume of €29.32bn by 2029.
Hong Kong's residential real estate market is experiencing a surge in demand due to low interest rates and a limited supply of housing.

Key regions: Germany, Europe, Asia, United States, United Kingdom

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Analyst Opinion

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

Customer preferences: One of the key customer preferences in the Residential Real Estate Transactions market in Hong Kong is the demand for high-quality properties with modern amenities and convenient locations. Buyers are increasingly looking for properties that offer a luxurious lifestyle and are situated in popular neighborhoods with good transportation links. Additionally, there is a growing interest in properties that incorporate sustainable and energy-efficient features.

Trends in the market: One of the prominent trends in the Residential Real Estate Transactions market in Hong Kong is the increasing demand for smaller, more affordable properties. This trend can be attributed to several factors, including rising property prices and limited land supply in the city. As a result, developers are focusing on building smaller units to cater to the needs of first-time buyers and young professionals. Another trend in the market is the growing popularity of co-living spaces. With the rising cost of living and limited space in Hong Kong, many individuals are opting for co-living arrangements where they can share common areas and amenities with other residents. This trend is particularly appealing to young professionals and expatriates who are looking for affordable and flexible housing options.

Local special circumstances: One of the unique factors influencing the Residential Real Estate Transactions market in Hong Kong is the city's limited land supply. With a high population density and limited available land, developers face challenges in finding suitable locations for new residential projects. This scarcity of land has led to increased competition among developers and rising property prices. Another local special circumstance is the influence of the Mainland Chinese buyers in the market. Due to its proximity to mainland China and its status as an international financial hub, Hong Kong has attracted significant investment from Mainland Chinese buyers. These buyers often purchase properties for investment purposes or as a means to diversify their investment portfolios.

Underlying macroeconomic factors: Several underlying macroeconomic factors contribute to the development of the Residential Real Estate Transactions market in Hong Kong. One of the key factors is the city's strong economic growth and stability. Hong Kong's robust financial sector, low taxes, and business-friendly environment attract both local and international investors, driving demand for residential properties. Another factor is the low interest rate environment. With low borrowing costs, individuals are more inclined to invest in real estate, leading to increased demand for residential properties. Additionally, the government's favorable policies, such as stamp duty exemptions for first-time buyers and tax incentives for property investment, further stimulate the market. In conclusion, the Residential Real Estate Transactions market in Hong Kong is experiencing growth and development driven by customer preferences for high-quality properties, trends towards smaller and more affordable units, and the unique local circumstances of limited land supply and Mainland Chinese buyers. These factors, along with the underlying macroeconomic stability and low interest rates, contribute to the overall positive outlook for the market.

Methodology

Data coverage:

Figures are based on total and average revenue of residential real estate transactions (sales).

Modeling approach:

Market size is determined by a 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 considered at a country-specific level.