Hong Kong Property Prices Rise as Market Recovery Gains Momentum

Hong Kong’s residential property market is experiencing a sustained recovery in early 2026, characterized by rising prices and rental growth following a prolonged period of correction that began in late 2019.

Data from early 2026 indicates that the recovery has gained significant momentum. According to a report from February 25, 2026, lived-in home prices increased by 0.53 per cent month-on-month in January 2026. This growth extended a recovery trend that first emerged in the second quarter of 2025.

The index tracking second-hand home prices reached 301.4, which represents the highest level since June 2024. This reflects a cumulative rebound of 5.79 per cent from a low point in March 2025, marking the first time the index has exceeded the 300-point mark in over a year and a half.

Market Drivers and Price Trends

Analysts attribute the current strength of the residential sector to several key factors, including the activity of mainland Chinese buyers, interest-rate cuts, and rising rental prices. Rental prices in the city also advanced by 0.3 per cent in January 2026, reaching a new high.

Midland Realty reports that its property price index has risen by 5.04 per cent so far in 2026, a figure that is approaching the total growth recorded for the entirety of 2025. 134 housing estates across Hong Kong have seen price increases, with 34 of those estates rising by more than 15 per cent.

The Centaline Property Price Index (CVI) for major banks rose by 1.4 points on a weekly basis to reach 81.64 points. Centaline also noted a significant reduction in the number of estates with price-per-square-foot values below 10,000 HKD, which has decreased by 50 per cent.

Institutional Forecasts for 2026

Major real estate and financial institutions project a continued upward trajectory for the residential market throughout 2026. J.P. Morgan reported on March 18, 2026, that after residential prices fell nearly 30 per cent since 2021, they bounced back 4.7 per cent year-on-year in 2025 and have continued to gain momentum.

CBRE expected 2025 to conclude with positive residential price growth of approximately 2 per cent. Following the emergence from a trough in 2025, CBRE projects that prices will rise by around 3 per cent in 2026, signaling the start of a new upward cycle.

JLL provides a slightly broader forecast, predicting that mass residential prices will rebound between 0 and 5 per cent in 2026. JLL notes that while the residential sector remains supported by mainland buyers, the overall property market recovery remains uneven.

Broader Real Estate Context

The recovery in the housing market is occurring alongside a rebound in the office leasing sector, specifically in Central and Tsim Sha Tsui. JLL forecasts that Grade A office rents in Central will rise by 0 to 5 per cent in 2026, driven by resilient demand from hedge funds, wealth management firms, and other financial institutions.

However, other segments of the real estate market continue to face headwinds. JLL expects the following trends for 2026:

• High Street shop rents are expected to fall by 0 to 5 per cent.
• Prime shopping mall rents are projected to decline by a further 5 to 10 per cent.
• Capital values for Grade A offices are expected to drop by 0 to 5 per cent.
• High Street shop prices are expected to fall between 5 and 10 per cent.

The industrial sector also shows signs of pressure, with prime warehouse vacancy rates reaching a decade-high of 10.1 per cent at the end of 2025, contributing to a 7.2 per cent decrease in rents.

Despite these disparities across different sectors, the residential market is expected to remain resilient. The head of valuation and advisory services at CBRE Hong Kong stated that the market is likely to stay positive throughout 2026 due to signs of pent-up demand and ample liquidity.