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Hong Kong had a tough time in 2019 and suffered from a weakened economy, the ongoing trade war between the US and China, and violent protests.
In 2020, the city faced the same dilemma as COVID-19 spread globally and forced countries and regions into lockdowns.
With that said, Hong Kong has remained resilient despite these unrests. Since 2003, the market has seen a six-fold increase in the index of private home prices.
Prices dropped by as little as 4% from May 2019 until the protest broke out and the COVID-19 pandemic started. The demand has primarily been supported by low-interest rates and a great scarcity of land.
With that said, we move into unknown territories for 2021. In this article, I share my predictions for Hong Kong’s property market in 2021.
- Hong Kong’s Property Market in Previous Years
- Hong Kong Property Prices in 2019
- How was the market affected by the COVID-19 pandemic in 2020?
- Why is Hong Kong property so expensive?
- How will Hong Kong’s property market perform in 2021?
- Is buying a property in Hong Kong a good investment?
Hong Kong’s Property Market in Previous Years
Hong Kong has the most expensive property market in the world, outperforming places like Singapore and Sydney.
Real estate prices have increased by double digits, making real estate inaccessible to many locals. As of 2020, houses averaged more than USD 1.2 million, which is kind of unbelievable.
Looking at real price increases, in the second quarter of 2018, the year-on-year price increase was 13.5%, which was a bit higher than the price increase in the first quarter of 2018.
At the same time, the average sales value per transaction increased by 8.4%, according to Colliers.
Colliers also reported that the supply of residential units increased by 12% in 2018 compared to 2017. The luxury residential rents increased by 4% in 2018.
Nowadays, you can buy a 10-bedroom house in many European countries for the same price as a 28 square meter apartment in Hong Kong. Besides, the average price per square meter in Ho Chi Minh City is only 14% of that in Hong Kong.
Hong Kong Property Prices in 2019
Looking at real price levels, the average price per square meter was around USD 22,507 in April 2019. That was almost twice as much as Singapore’s average of around USD 11,442.
Prices have grown strongly for over a decade, except for a brief slump in 2016 due to the mortgage rate hike. We also saw price decreases during the second half of 2018 and 2019. The Centa-City Leading Index CCL shows the price increases from 1996 – August 2019, which speaks for itself. Continue reading Hong Kong Property Market Outlook 2021: A Complete Overview