2025 CBRE Hong Kong Residential Market Outlook with Forecast

CBRE recently conducted a deep dive into the Hong Kong residential property market for 2025, and the findings are quite interesting. Eddie Kwok, Executive Director of Valuation & Advisory Services at CBRE Hong Kong, shared some key insights from the research.

In the primary market, we are expecting to see a growth in volume with stable prices. After hitting a low point with 10,000 units in 2022-2023, primary sales bounced back to 17,000 units in 2024, aligning with the 2017-2021 average. There is a projected 10% growth in 2025, potentially reaching 18,000-20,000 units if interest rates continue to drop.

On the secondary market front, prices are anticipated to rebound from a low base. We predict that the secondary market will return to the 2017-2020 average of 41,953 units, seeing a 10% rebound to almost 40,000 units in 2025. This rebound is expected to be fueled by factors like low taxes after the removal of property curbs, stable economic fundamentals, and a shift from renting to homeownership.

When it comes to overall transaction volume, we estimate that it will be close to 60,000 transactions, marking a 10% year-on-year growth. Primary sales are expected to contribute around 18,000 to 20,000 units, while secondary sales will make up approximately 40,000 units.

One interesting trend to note is the impact of easing borrowing rates. Lower mortgage payments compared to rental costs could drive tenants to become homeowners, boosting demand in both primary and secondary markets.

As for residential prices, a mild recovery of 0% to 5% is projected overall. Newer properties under 20 years old may experience recovery or stabilization in prices, while older properties over 40 years old might lag behind. Rising rental demand, especially for one- and two-bedroom units, is expected to drive investment in the primary market, attracting investors with higher rental yields.

In terms of the rental market, we anticipate rental growth to continue its upward trend with approximately 5% growth in FY2025. For luxury residential properties, prices are forecasted to normalize after a period of significant distressed sales in 2024.

These insights provide a comprehensive view of what to expect in the Hong Kong residential property market in 2025. It’s always essential to stay informed about market trends to make well-informed decisions, whether you are a buyer, seller, agent, developer, or someone just curious about the real estate landscape.