Valuer Insights

Business Insights | Hong Kong Residential Insights July 2025

By Valuation & Advisory Services

August 27, 2025

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In this report, we look into Hong Kong residential property market.

Snapshot

Residential market is on the cusp of recovery, with transaction volume steadily picking up

The Hong Kong residential market demonstrated continued strength in July. While total transaction volume dipped slightly by 3.2% m-o-m to 5,766 deals, the market has maintained momentum with volumes exceeding 5,000 for five consecutive months. This performance is largely driven by robust first-hand sales, consistently exceeding 1,500 units monthly since March 2025.
Residential prices continue to stabalise

Hong Kong residential prices continued to stabilize in June, recording a slight increase of 0.03% m-o-m—marking three consecutive months of growth. However, compared to the same period last year, it fell by 5.20%, and it has cumulatively decreased by 0.86% in the first half of the year.
Leasing market continues to outperform

In July, traditionally a peak season for leasing, rental activity was notably robust. This momentum was largely driven by expatriates and non-local students, contributing to a 0.3% m-o-m increase in the private residential rental index for June and a cumulative rise of 1.6% over the first half of the year. Larger flat units have also shown stronger rental growth, supported by demand from Top Talents, with Class D and E units recording a 2.5% Y-T-D increase, compared to 1.5% for smaller Class A, B, and C units.
Proposed “Property connect” to bring a positive signal to the property market

The cross-border “Property Connect” mechanism, which is reportedly under discussion with the central government, alongside existing schemes like the Top Talent and CIES programs, is set to further incentivize mainland investment, reinforcing Hong Kong’s appeal as a lifestyle and education hub. This influx of capital and buyer confidence is likely to stabilize and uplift the luxury residential segment, especially as distressed inventory clears and interest rates remain favorable.

Outlook

Looking ahead, we anticipate that developers may begin to scale back aggressive price cuts, particularly as inventory levels continue to decline amid steady absorption. This trend is likely to provide support for overall residential price. Given the improvement in market sentiment coupled with current low financing cost situation, we are cautiously optimistic that we are proceeding to a bottom out.
With more new projects launching in the coming months, primary sales are expected to gain a larger market share compared to its first half of the year. We foresee transaction volume remaining vibrant amid growing buyer confidence and pent-up demand. This may also signal the end of the residential market correction since 2021.