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Hong Kong Major Report - Hong Kong Market Outlook 2024

January 16, 2024 20 Minute Read

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CBRE expect widely anticipated rate cuts to materialise in 2024, improving property market sentiment. Potential rate cuts will weaken local currency and boost financial market sentiment, benefitting retail and office leasing momentum. However, geopolitical tension is expected to persist, ensuring continued economic uncertainty and weak global trade. 

  1. Economy
    Although keenly anticipated rate cuts will raise the likelihood of an improvement in investment activity in 2024, a range of headwinds will ensure economic growth remains modest.
  2. Investment
    Lower interest rates should result in stronger investment activity for real estate. However, negative carry and demand-side uncertainty will limit chances of a strong uptick in investment volume.
  3. Office
    While new leasing momentum will continue to pick up along with the gradual recovery of the Chinese economy and anticipated rate cuts, any upturn in deal flow will be insufficient to reduce vacancy pressure. Rents are set to decline further in 2024.
  4. Retail
    Leasing demand is expected to remain healthy, backed by a continued improvement in retail sales. With rental affordability set to remain a challenge, any further increases will be moderate.
  5. Industrial & Logistics
    Occupier demand from traditional sectors is set to remain limited, meaning that emerging trades will fuel demand for industrial space. Despite low vacancy, attractive rental packages will remain key to securing tenants in a market with fragile demand.

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