Valuer Insights
Which Secondary Residential Developments Are Worth Investing In?
May 29, 2025
Contact
Angus Luk
Senior Director, Valuation & Advisory Services, Hong Kong
In early 2025, the Hong Kong property market experienced notable rebound driven by policy adjustments. The Hong Kong SAR Budget in February introduced a reduction in stamp duty, applying a flat rate of HK$100 for residential transactions less than HK$4 million. This move aimed to stimulate activities in the lower end of the property market. As a result, even prices under HK$6 million have been active. With HIBOR rates declining recently, the borrowing costs fell below the ceiling mortgage cap rate of 3.5%. These favorable financial conditions contributed to a surge in market interest, particularly in residential flats priced at HK$6 million or below.
The impact of these market changes was evident in transaction patterns. In the first quarter of 2025, 45% of first-hand residential flats sold were priced under HK$6 million. These were predominantly one- to two-bedroom units, marking the highest proportion in 16 years. Similarly, the second-hand market saw over 50% of transactions fall under the HK$6 million mark, reaching a nine-year high since 2016. These figures highlight a growing demand for more affordable housing options among buyers.
Investor confidence remained strong in traditional residential developments. Among the 120 residential projects tracked by the Rating and Valuation Department (RVD), 30 blue-chip estates recorded over 100 transactions each in 2024.
The top 10 estates by transaction volume were Kingswood Villas (434), Mei Foo Sun Chuen (364), Taikoo Shing (331), City One Shatin (289), Discovery Bay (262), Whampoa Garden (248), South Horizons (200), Laguna City (194), Caribbean Coast (168), and Ocean Shores (166). These estates alone accounted for a significant portion of the 40,734 secondary private transactions recorded in 2024, with 22.6% originating from the selected 120 estates.
Looking into the second-hand market across different districts, according to 2024 transaction data:
Hong Kong Island
Kowloon
New Territories
Outlying Islands
In the first four months of 2025, Hong Kong’s property market showed signs of steady growth, with particular strength in the secondary residential sector. Among the 30 major housing estates mentioned earlier, six stood out with over 100 transactions each. These six estates were Mei Foo Sun Chuen (155 transactions), Kingswood Villas (148), Taikoo Shing (120), Discovery Bay (115), Whampoa Garden (100), and City One Shatin (100).
The good performance can be attributed to several key factors. Firstly, their relatively affordable prices make them attractive to both first-time homebuyers and investors, lowering the entry barrier. Secondly, convenient transportation is a major advantage—Mei Foo, Taikoo, Kingswood Villas, Whampoa Garden, and City One Shatin all have MTR stations, making daily commuting and travel easier for residents. Discovery Bay, on the other hand, is known for its tranquil living environment, making it ideal for families seeking peace and a higher quality of life.
From a broader market perspective, with interest rates stabilising and property prices adjusting, buyer sentiment is gradually recovering. There is a noticeable increase in demand for practical and cost-effective housing estates, as reflected in the active transactions in these six major estates.
As HIBOR begins to decline, many investors are adjusting their strategies to refocus on real estate. Rising rental yields are further encouraging property investment as a means to secure higher returns. The Hong Kong property market is expected to gradually emerge from its downturn, with transaction volumes and prices trending toward stability, injecting renewed confidence and momentum into the market.
The impact of these market changes was evident in transaction patterns. In the first quarter of 2025, 45% of first-hand residential flats sold were priced under HK$6 million. These were predominantly one- to two-bedroom units, marking the highest proportion in 16 years. Similarly, the second-hand market saw over 50% of transactions fall under the HK$6 million mark, reaching a nine-year high since 2016. These figures highlight a growing demand for more affordable housing options among buyers.
Investor confidence remained strong in traditional residential developments. Among the 120 residential projects tracked by the Rating and Valuation Department (RVD), 30 blue-chip estates recorded over 100 transactions each in 2024.
The top 10 estates by transaction volume were Kingswood Villas (434), Mei Foo Sun Chuen (364), Taikoo Shing (331), City One Shatin (289), Discovery Bay (262), Whampoa Garden (248), South Horizons (200), Laguna City (194), Caribbean Coast (168), and Ocean Shores (166). These estates alone accounted for a significant portion of the 40,734 secondary private transactions recorded in 2024, with 22.6% originating from the selected 120 estates.
Looking into the second-hand market across different districts, according to 2024 transaction data:
Hong Kong Island
- Key estates with more than 100 transactions recorded in 2024: Kornhill, Taikoo Shing, South Horizon, Heng Fa Chuen
- Taikoo Shing led with 331 transactions and 275 rental deals
- Inventory: 673 for sale and 135 units for rent
Kowloon
- Key estates with more than 100 transactions recorded in 2024: Mei Foo Sun Chuen (364 transactions), Whampoa Garden (248 transactions)
- Inventory: 1,067 for sale and 209 for rent
New Territories
- 14 Key estates with more than 100 transactions recorded in 2024, including Kingswood Villas (434) and City One Shatin (289)
- Inventory: 2,450 for sale and 942 for rent
Outlying Islands
- Key estates with more than 100 transactions recorded in 2024: Discovery Bay (262), Caribbean Coast (168).
- Inventory: 652 for sale and 220 for rent
In the first four months of 2025, Hong Kong’s property market showed signs of steady growth, with particular strength in the secondary residential sector. Among the 30 major housing estates mentioned earlier, six stood out with over 100 transactions each. These six estates were Mei Foo Sun Chuen (155 transactions), Kingswood Villas (148), Taikoo Shing (120), Discovery Bay (115), Whampoa Garden (100), and City One Shatin (100).
The good performance can be attributed to several key factors. Firstly, their relatively affordable prices make them attractive to both first-time homebuyers and investors, lowering the entry barrier. Secondly, convenient transportation is a major advantage—Mei Foo, Taikoo, Kingswood Villas, Whampoa Garden, and City One Shatin all have MTR stations, making daily commuting and travel easier for residents. Discovery Bay, on the other hand, is known for its tranquil living environment, making it ideal for families seeking peace and a higher quality of life.
From a broader market perspective, with interest rates stabilising and property prices adjusting, buyer sentiment is gradually recovering. There is a noticeable increase in demand for practical and cost-effective housing estates, as reflected in the active transactions in these six major estates.
As HIBOR begins to decline, many investors are adjusting their strategies to refocus on real estate. Rising rental yields are further encouraging property investment as a means to secure higher returns. The Hong Kong property market is expected to gradually emerge from its downturn, with transaction volumes and prices trending toward stability, injecting renewed confidence and momentum into the market.